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TTM TECHNOLOGIES INC

TTM TECHNOLOGIES INCTTMIEarnings & Financial Report

Nasdaq · Information Technology · Printed Circuit Boards

TTM Technologies, Inc. is an American printed circuit board (PCB) manufacturer headquartered in Santa Ana, California. Founded in 1998, the company is one of the top five PCB manufacturers in the world and the largest in North America, and the largest supplier of PCBs to the U.S. military. TTM serves customers in industries including aerospace and defense, medical, industrial, automotive, computing, and networking.

What changed in TTM TECHNOLOGIES INC's 10-K — 2024 vs 2025

Top changes in TTM TECHNOLOGIES INC's 2025 10-K

405 paragraphs added · 583 removed · 326 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

101 edited+18 added−110 removed19 unchanged
We also offer comprehensive benefit plans for eligible employees including mental health, employee assistance program (EAP), telemedicine offerings, several medical and dental plans with qualifying employer-funded health savings accounts, life insurance, 15 specialty programs for diabetes and weight loss, wellness challenges, and an on-site health and physical therapy center at one of our largest U.S. facilities.
We also offer comprehensive benefit plans for eligible employees, including mental health, employee assistance program (EAP), telemedicine offerings, several medical and dental plans with qualifying employer-funded health savings accounts, life insurance, specialty programs for diabetes and weight loss, wellness challenges, and an on-site health and physical therapy center at one of our largest U.S. facilities.
Through a variety of plating and etching processes, we selectively add and remove conductive materials to form horizontal layers of thin circuitry, which are separated by electrical insulating material. A multilayer circuit board is produced by laminating together multiple layers of circuitry, using intense heat and pressure under vacuum.
Through plating and etching processes, we selectively add and remove conductive materials to form horizontal layers of thin circuitry, which are separated by electrical insulating material. A multilayer circuit board is produced by laminating together multiple layers of circuitry, using intense heat and pressure under vacuum.
The trend in the electronic products industry continues to be to implement and develop means to increase the speed, complexity, and performance of components while reducing 8 their size. We believe our technological capabilities allow us to address the needs of manufacturers to bring complicated electronic products to market faster.
The trend in the electronic products industry continues to be to implement and develop means to increase the speed, complexity, and performance of components while reducing their size. We believe our technological capabilities allow us to address the needs of manufacturers to bring complicated electronic products to market faster.
Copies are also available without charge by (1) telephonic request by calling our Investor Relations Department at (714) 327-3000; (2) e-mail request to investor@ttmtech.com; or (3) a written request to TTM Technologies, Inc., Attention: Investor Relations, 200 East Sandpointe, Suite 400, Santa Ana, CA 92707. 16
Copies are also available without charge by (1) telephonic request by calling our Investor Relations Department at (714) 327-3000; (2) e-mail request to investor@ttmtech.com; or (3) a written request to TTM Technologies, Inc., Attention: Investor Relations, 200 East Sandpointe, Suite 400, Santa Ana, CA 92707. 12
Each segment operates predominantly in the same industries with facilities that produce customized products for our customers and use similar means of product distribution. Additional information on our reportable segments and product information is contained in Part II, Item 8, Note 10, Segment Information , of the Notes to Consolidated Financial Statements.
Each segment operates predominantly in the same industries with facilities that produce customized products for our customers and use similar means of product distribution. Additional information on our reportable segments and product information is contained in Part II, Item 8, Note 4, Segment Information , of the Notes to Consolidated Financial Statements.
The aspect ratio is the ratio between the thickness of the PCB and the diameter of a drilled hole. As the aspect ratio increases, it becomes increasingly difficult to consistently and reliably form, electroplate, and finish all the holes on a PCB. In production, we are able to provide aspect ratios of up to 30:1. • Thin core processing.
The aspect ratio is the ratio between the thickness of the PCB and the diameter of a drilled hole. As the aspect ratio increases, it becomes increasingly difficult to consistently and reliably form electroplate, and finish all the holes on a PCB. We are able to provide aspect ratios of up to 30:1. • Thin core processing.
The following elements underpin our culture: • Vision – Inspire innovation as a global preeminent technology solutions company. • Mission – Provide customers with market leading, differentiated solutions, and an extraordinary customer experience. • The “TTM Values” that apply to all employees are: Integrity, Teamwork, Clear Communication, and Performance Excellence. • Our people leaders are guided by our “Leadership Principles” which are: Results, Communications, Collaboration, and Career Development. • “One TTM” – embodies our collective “team” approach to solving problems, working together, robust collaboration, and proactive communication throughout the organization to better serve our customers.
The following elements underpin our culture: • Vision – Inspire innovation as a global preeminent technology company. • Mission – Provide customers with market leading, differentiated solutions, and an extraordinary customer experience. • The “TTM Values” are: Integrity, Teamwork, Clear Communication, and Performance Excellence. • Our people leaders are guided by our “Leadership Principles” which are: Results, Communications, Collaboration, and Career Development. • “One TTM” – embodies our collective “team” approach to solving problems, working together, robust collaboration, and proactive communication throughout the organization to better serve our customers.
The backplane assemblies, PCB assemblies, and precision metal fabricated chassis and enclosures which we produce are often incorporated into a fully integrated and tested system delivered to our customer. These products often incorporate procured power, thermal, interconnect, and mechanical components sourced from either customer directed or our selected suppliers.
The backplane assemblies, PCB assemblies, and precision metal fabricated chassis and enclosures are often incorporated into a fully integrated and tested system delivered to our customer. These products often incorporate procured power, thermal, interconnect, and mechanical components sourced from either customer directed or our selected suppliers.
Our Code of Conduct includes topics such as anti-corruption, discrimination, harassment, privacy, appropriate use of company assets, protecting confidential information, and reporting Code of Conduct violations. Our Code of Conduct reinforces the importance of fostering an open, welcoming environment in which all employees have a voice and a confidential outlet to raise concerns regarding potential violations.
Our Code of Conduct includes topics such as anti-corruption, discrimination, harassment, privacy, appropriate use of company assets, protecting confidential information, and reporting Code of Conduct violations. It reinforces the importance of an open and welcoming environment in which all employees have a voice and a confidential outlet to raise concerns regarding potential violations. Talent Acquisition.
Commitment to Values and Ethics. The foundation of TTM’s strategic vision is its corporate culture and its way of doing business with integrity, teamwork, clear communication, and performance excellence. We seek to demonstrate the importance we place on these values through our goal setting and performance management process as well as providing ethics training to employees every year.
Commitment to Values and Ethics. The foundation of our strategic vision is our corporate culture and our way of doing business with integrity, teamwork, clear communication, and performance excellence. We seek to demonstrate the importance of these values through our goal setting and performance management process as well as providing ethics training to employees every year.
As our customers consolidate their supply chains, our objective is to differentiate ourselves as a strategic supplier with the technology breadth to meet most, if not all, of our customers’ PCB and RF related requirements.
As our customers consolidate their supply chains, our objective is to differentiate ourselves as a strategic supplier with the technology breadth to meet most, if not all, of our customers’ advanced interconnect and RF related requirements.
The Government Security Committee of our Board of Directors consists of at least three Board members that hold a National Security Clearance. The DCSA will continue to review TTM’s compliance with the terms of the SBR annually at each of TTM’s sites which operate under a U.S. DoD security clearance.
The Government Security Committee of our Board of Directors consists of at least three Board members that hold a National Security Clearance. The DCSA will continue to review TTM’s compliance with the terms of the SBR annually at each of TTM’s sites which operate under a DoW security clearance.
Beamforming and Switching Networks Our beamforming technologies are used in military and aerospace applications, offering a variety of active and passive high‑performance RF assemblies, including L-band/LEO and L- and S-band/GEO space beamformers, UHF thru Ka-band radar AESA RF networks, Butler matrices, multi-octave, and more.
Our passive and active beamforming technologies are used in military and space applications, offering a variety of active and passive high‑performance RF assemblies, including L-band/LEO and L- and S-band/GEO space beamformers, UHF thru Ka-band radar AESA RF networks, Butler matrices, multi-octave, and more. Custom Designed ASICs .
In regard to our RF products, the vast majority are proprietary and protected or covered by approximately forty-five (45) patents and three (3) currently pending patent applications directed towards products for both the wireless infrastructure and aerospace and defense markets.
In regard to our RF products, the vast majority are proprietary and protected or covered by approximately 48 patents and 3 currently pending patent applications directed towards products for both the wireless infrastructure and aerospace and defense markets.
In China, approximately 8,500 employees are members of the All-China Federation of Trade Unions and accordingly are considered to be represented by a labor union. We believe that our relations with both our union and non-union employees are satisfactory.
In 11 China, approximately 9,900 employees are members of the All-China Federation of Trade Unions and accordingly are considered to be represented by a labor union. We believe that our relations with both our union and non-union employees are satisfactory.
We believe our expertise is enhanced by our ability to deliver highly complex PCBs to customers in significantly compressed lead times. This rapid delivery service enables OEMs to develop sophisticated electronic products more quickly and reduce their time to market.
Our expertise is enhanced by our ability to deliver highly complex interconnect and integration solutions to customers in significantly compressed lead times. This rapid delivery service enables OEMs to develop sophisticated electronic products more quickly and reduce their time to market.
The material for these systems come from a variety of sources, including OEMs and Contract Manufacturers, and are often defined by the end customer. 11 We typically use just-in-time procurement practices to maintain our raw materials inventory at low levels and work closely with our suppliers to obtain technologically advanced raw materials.
The materials for these systems come from a variety of sources, including OEMs and Contract Manufacturers. We typically use just-in-time procurement practices to maintain our raw materials inventory at low levels and work closely with our suppliers to obtain technologically advanced raw materials.
We serve a diversified customer base consisting of approximately 1,400 customers in various markets throughout the world, including aerospace and defense, data center computing, automotive, medical, industrial and instrumentation, and networking. Our customers include original equipment manufacturers (OEMs), electronic manufacturing services (EMS) providers, original design manufacturers (ODMs), distributors, and government agencies (both domestic and allied foreign governments).
We serve a diversified customer base consisting of approximately 1,300 customers in various markets throughout the world, including aerospace and defense, data center computing, automotive, medical, industrial, and instrumentation, and networking. Our customers include OEMs, EMS providers, ODMs, distributors, and government agencies (both domestic and allied foreign governments).
The NISPOM requires that a corporation with significant foreign ownership maintaining a facility security clearance take steps to prevent foreign ownership, control, or influence (FOCI). In February of 2023, our Board of Directors passed a Special Board Resolution (SBR), replacing the Special Security Agreement (SSA) that we entered into with the Defense Counterintelligence and Security Agency (DCSA) in 2010.
The NISPOM requires that a corporation with significant foreign ownership maintaining a facility security clearance take steps to prevent foreign ownership, control, or influence (FOCI). In February of 2023, our Board of Directors passed an SBR, replacing the SSA that we entered into with the DCSA in 2010.
The more complicated RF subsystems may require us to purchase integrated subassemblies and super-components such as RF oscillators, frequency converters, power supplies, and microprocessors. These components for backplane assemblies and other PCB assemblies in some cases have limited or sole sources of supply.
The more complicated RF subsystems require integrated subassemblies and super-components such as RF oscillators, frequency converters, power supplies, and microprocessors. Some components for backplane assemblies and other PCB assemblies have limited or sole sources of supply.
We have a history of executing successful acquisitions that have been key to our growth and profitability. Historically, we focused on strategic opportunities that could facilitate our efforts to further diversify into other growing end markets.
Accelerate customer, end market, and technology diversification through strategic mergers and acquisitions. We have a history of executing successful acquisitions that have been key to our growth and profitability. Historically, we focused on strategic opportunities that could facilitate our efforts to further diversify into other growing end markets.
National Security Matters A portion of our business consists of manufacturing defense and defense-related items for various departments and agencies of the U.S. government, including the U.S. Department of Defense (DoD), which requires that we maintain facility security clearances under the NISPOM.
National Security Matters A portion of our business consists of manufacturing defense and defense-related items for various departments and agencies of the USG, including the DoW, which requires that we maintain facility security clearances under the NISPOM.
Accelerate our expansion into growing markets using our advanced technology as a key point of differentiation. With rising requirements for faster data transmission, shrinking features (i.e., lightweight and thin), and lower power consumption, many PCB designs have migrated to more complex HDI PCBs from conventional multilayer PCB technologies.
Accelerate our expansion into growing markets using our advanced technology and diversified global manufacturing footprint as key points of differentiation. With rising requirements for faster data transmission, shrinking features (i.e., lightweight and thin), thermal management and lower power consumption, many advanced interconnect product designs have migrated to more complex multilayer and advanced HDI PCBs from conventional multilayer PCB technologies.
Products and Services We offer a wide range of engineered systems, RF and microwave assemblies, HDI PCBs, flexible PCBs, rigid-flex PCBs, custom assemblies and system integration, IC substrates, passive RF components, advanced ceramic RF components, hi-reliability multi-chip modules, beamforming and switching networks, PCB products, RF components, and backplane/custom assembly solutions, including conventional PCBs.
We offer a wide range of 9 engineered systems, passive RF components, advanced ceramic RF components, hi-reliability multi-chip modules, beamforming and switching networks, IC substrates, and PCB and RF products, including HDI and ultra-HDI PCBs, conventional PCBs, flexible PCBs, rigid-flex PCBs, and custom assemblies.
We report our worldwide operations based on two reportable segments: (1) PCB , which consists of 15 domestic system, subsystem, and PCB plants; four PCB fabrication plants in China; one in Malaysia; and one in Canada; and (2) RF and Specialty Components (RF&S Components) , which consists of one domestic RF component plant and one RF component plant in China.
We report our worldwide operations based on three reportable segments: (1) A&D , which consists of 13 domestic system, subsystem, and PCB fabrication plants; (2) Commercial , which consists of three domestic PCB fabrication plants, four PCB fabrication plants in China, one in Malaysia, and one in Canada; and (3) RF&S Components , which consists of one domestic RF component plant and one RF component plant in China.
These patents are derived from internal research and development as well as a number of intellectual property portfolio acquisitions beginning in 2018. Our PCB business depends on the effectiveness of our fabrication techniques, proprietary PCB structures, and our ability to continually improve our manufacturing processes.
We now have a total of approximately 185 patents, with approximately 84 pending patent applications. These patents are derived from internal research and development as well as a number of intellectual property portfolio acquisitions beginning in 2018. Our PCB business depends on the effectiveness of our fabrication techniques, proprietary PCB structures, and our ability to continually improve our manufacturing processes.
We strongly believe in the benefits of sharing best practices across our extensive manufacturing footprint and rely on stringent goals for throughput, quality, and customer satisfaction to measure our effectiveness. The fast-paced nature of our business requires a disciplined approach to manufacturing that is rooted in continuous improvement. Accelerate customer, end market, and technology diversification through strategic mergers and acquisitions.
We strongly believe in the benefits of sharing best practices across our extensive manufacturing footprint and rely on stringent goals for throughput, quality, and customer satisfaction to measure our effectiveness. The fast-paced nature of our business requires a disciplined approach to manufacturing that is rooted in continuous improvement and new capability development.
Employee Data As of December 30, 2024, we had approximately 16,400 employees. Our employees were distributed by function approximately as follows: 13,100 in manufacturing positions, 1,800 in engineering or technician positions, 500 in sales and marketing positions, and 1,000 in professional, managerial, or other administrative positions. Of our 5,800 U.S. employees, 50 are represented by unions.
Employee Data As of December 29, 2025, we had approximately 18,200 employees. Our employees were distributed by function approximately as follows: 14,800 in manufacturing positions, 1,800 in engineering or technician positions, 1,100 in professional, managerial, or other administrative positions, and 500 in sales and marketing positions. Of our 5,900 U.S. employees, 50 are represented by unions.
In addition, we produce PCBs with electrically passive heat sinks laminated externally on a circuit board or between two circuit boards, as well as PCBs with electrically active thermal cores. Manufacturing Technologies The market for our products is characterized by rapidly evolving technology.
We produce PCBs with heavy copper cores, embedded and press-fit coins, electrically passive heat sinks laminated externally on a circuit board or between two circuit boards, and electrically active thermal cores. Manufacturing Technologies The market for our products is characterized by rapidly evolving technology.
Vertical connections between layers are achieved by drilling and plating through small holes, called vias. Vias are made by highly specialized drilling equipment capable of achieving extremely fine tolerances with high accuracy. We specialize in high layer count PCBs with extremely fine geometries and tolerances.
Vertical connections between layers are achieved by drilling and plating through small holes, called vias. Vias are made by highly specialized drilling equipment capable of achieving extremely fine tolerances with high accuracy. We specialize in high layer count PCBs with extremely fine geometries and tolerances, and employ clean rooms that are designed to prevent defects on the circuit patterns.
Our ramp-to-volume services typically include manufacturing up to several hundred PCBs per order with delivery times ranging from five to 15 days. Thermal management Increased component density on circuit boards often requires improved thermal dissipation to reduce operating temperatures. We produce printed circuits with heavy copper cores and both embedded and press-fit coins.
Our ramp-to-volume services typically include manufacturing up to several hundred PCBs per order with delivery times ranging from five to 15 days. Thermal management. Increased component density on circuit boards often requires improved thermal dissipation to reduce operating temperatures.
As electronic devices have become smaller and more portable with higher functionality, demand for advanced HDI PCB products has increased dramatically. We define advanced HDI PCBs as those having more than one layer of microvia interconnection structure. Substrate-like PCBs or SLPs SLPs represent the next evolution of high-end HDI PCBs.
As electronic devices have become smaller and more 6 portable with higher functionality, demand for advanced HDI PCB (defined as those having more than one layer of microvia interconnection structure) products has increased significantly. Substrate-like PCBs or SLPs .
The primary raw materials we use in engineered systems, RF components, RF subsystems, backplane assemblies, and other PCB assemblies are manufactured components such as PCBs, ceramic and ferrite substrates, connectors, capacitors, resistors, diodes, and integrated circuits, many of which are custom made and controlled by our customers’ approved vendors.
For engineered systems, RF components, RF subsystems, backplane assemblies, and other PCB assemblies, primary raw materials are manufactured components such as PCBs, ceramic and ferrite substrates, connectors, capacitors, resistors, diodes, and integrated circuits, many of which are custom made and sourced from customer-approved vendors.
We believe that by servicing our customers early in the development process, we are able to demonstrate our capabilities and establish an incumbent position early in the product development cycle, which translates into additional opportunities as our customers move into volume production.
We believe that by engaging with our customers early in the development process, we are better able to develop solutions for our customers’ needs and establish an incumbent position early in the product development cycle, which translates into additional opportunities as our customers move into volume production.
Although our contractual relationships are often with the EMS or ODM companies, we typically negotiate price and volume requirements directly with the OEMs. In addition, we are on the approved vendor lists of several of our EMS providers.
Although our contractual relationships are often with the EMS or ODM companies, we typically negotiate price and volume requirements directly with the OEMs. In addition, we are on the approved vendor lists of several of our EMS providers. This positions us to participate in business that is awarded at the discretion of the EMS provider.
HDI PCBs are boards with high-density characteristics including micro-sized holes, or microvias (diameter at or less than 0.15 mm), and fine line circuitry (circuit line width and spacing at or less than 0.075 mm) and are fabricated with thin high-performance materials, thereby enabling more interconnection functions per unit area.
Our facilities produce HDI PCBs, which are PCBs with high-density characteristics including micro-sized holes, or microvias (diameter at or less than 0.15 mm), fine line circuitry (circuit line width and spacing at or less than 0.075 mm), and are fabricated with thin high-performance materials.
PCBs serve as the foundation for virtually all electronic products, including the electronic components integrated into automobiles, high-end commercial electronic equipment (such as medical equipment, data communications routers, switches, and servers), and aerospace and defense electronic systems.
Industry Overview Advanced interconnect products serve as the foundation for virtually all electronic products, including the electronic components and subsystems integrated into automobiles, high-end commercial electronic equipment such as medical robotics and testing equipment, data center switches and servers, and aerospace and defense electronic systems.
Our global sales force is comprised of direct sales personnel, complemented by commission-based independent representatives, and supports customers throughout North America, Europe, Asia, and the Middle East.
Our global sales force is comprised of direct sales personnel, complemented by commission-based independent representatives, and supports customers throughout North America, Europe, Asia, and the Middle East. For certain risks attendant to our foreign operations, see Item 1A, Risk Factors .
Our customer-oriented strategies include engaging in co-development of new products, capturing new technology products for next generation equipment, and continuing investments to enhance our broad offering of PCB and RF/microwave technologies from components through integrated mission systems.
Our customer-oriented culture is designed to achieve extraordinary service, competitive differentiation, and superior execution. Our customer-oriented strategies include engaging in collaborative research and development and the co-development of new technologies and products, capturing new technology products for next generation equipment, and continuing investments to enhance our broad offering of advanced interconnect and RF/microwave technologies from components through integrated mission systems.
Furthermore, rigid-flex circuits can be found in small and lightweight end products and other space-challenged electronics packaging applications across all end markets. Some PCB manufacturers also manufacture high-performance substrates that serve as the interconnect between integrated circuits (IC) and the PCB in many advanced electronic products serving a wide variety of end markets.
Advanced technology interconnect product solutions such as HDI and SLP technologies provide increased circuit densities, rigid-flex circuits can be found in small and lightweight end products and other space-challenged electronics packaging applications, and high-performance substrates that serve as the interconnect between the IC and the PCB in many advanced electronic products are all found across a wide variety of end markets.
In our PCB reportable segment, we regularly manufacture PCBs with more than 30 layers on a quick-turn and volume basis. • Blind and buried vias . Vias are drilled holes that provide electrical connectivity between layers of circuitry in a PCB. Blind vias connect the surface layer of the PCB to an internal layer and terminate at the internal layer.
In our A&D and Commercial reportable segments, we regularly manufacture PCBs with more than 30 layers on a quick-turn and volume basis, producing complex high layer PCBs with over 70 layers. • Blind and buried vias . Vias are drilled holes that provide electrical connectivity between layers of circuitry in a PCB.
In addition, we now offer an alternative approach to building SLP technology in the United States for lower volume, higher mix commercial and aerospace and defense applications. 7 Flexible PCBs Flexible PCBs are printed circuits produced on flexible films, allowing them to be folded or bent to fit the available space or allowing for application movement.
We offer an alternative approach to building SLP technology in the U.S. for lower-volume, higher-mix commercial and aerospace and defense applications. Flexible PCBs . Flexible PCBs are printed circuits produced on flexible films that can be folded or bent for three-dimensional application movement and flexible electronic connectivity.
In 2024, we generated approximately $2.4 billion in net sales and ended the year with approximately 16,400 employees worldwide. We currently operate a total of 23 specialized facilities in North America and Asia. We focus on providing time-to-market and volume production of advanced technology products and offer a one-stop design, engineering and manufacturing solution to our customers.
We currently operate a total of 24 specialized facilities in North America and Asia. We focus on providing time-to-market and volume production of advanced technology products and offer a one-stop design, engineering, and manufacturing solution to our customers.
Now that we have a more diversified end market mix, our focus is to expand our presence in existing end markets, particularly aerospace and defense which has longer product and program life cycles. We will also look for strategic opportunities that further strengthen our leading-edge technology capabilities.
Now that we have a more diversified end market mix, our focus is to strengthen and expand our leadership positions in existing end markets. We will also look for strategic opportunities that further strengthen our leading-edge technology capabilities and aim to manage our exposure to cyclical businesses.
A core is the basic inner-layer building block material from which PCBs are constructed. A core consists of a flat sheet of material comprised of glass-reinforced resin with copper foil laminated on either side. The thickness of inner-layer cores is typically determined by the overall thickness of the PCB and the number of layers required.
A core is the basic inner-layer building block material from which PCBs are constructed and consists of a flat sheet of material comprised of glass-reinforced resin with copper foil laminated on either side. The demand for thinner cores derives from the requirements for thinner PCBs, higher layer counts, and various electrical parameters.
Radar Systems We provide a wide range of high-performing, lightweight, and cost-effective maritime surveillance and weather avoidance radar systems for fixed- and rotary-wing aircraft, Unmanned Aerial Vehicles (UAVs), and shipboard platforms to the U.S. government, tier one OEMs, and numerous international defense agencies. At this time, we are also the sole provider of the U.S.
Below we describe our product lines in more detail. Radar Systems . We provide a wide range of high-performing, lightweight, and cost-effective multi-mode surveillance and weather avoidance radar systems for fixed- and rotary-wing aircraft, Unmanned Aerial Vehicles (UAVs), and shipboard platforms to the USG, tier one OEMs, and numerous international defense agencies.
Included in the end markets that our OEM and EMS customers serve is the U.S. federal government. As a result, we are a supplier, primarily as a subcontractor, to the U.S. federal government. In addition, we also sell directly to government agencies (both domestic and allied foreign governments).
As a result, we are a supplier, primarily as a subcontractor, to the USG. In addition, we also sell directly to government agencies (both domestic and allied foreign governments).
Deliver consistently strong financial performance and execute on our balance sheet strategy. We aspire to deliver industry‑leading financial performance. We expect to achieve this by servicing our customers’ needs in higher-growth end markets in a cost‑efficient and effective manner.
We expect to achieve this by servicing our customers’ needs in higher-growth end markets in a cost‑efficient and effective manner.
We offer a wide range of engineered systems, passive RF components, advanced ceramic RF components, hi-reliability multi-chip modules, beamforming and switching networks, IC substrates, and PCB and RF products, including HDI and Ultra-HDI PCBs, conventional PCBs, flexible PCBs, rigid-flex PCBs, and custom assemblies. We also offer certain value-added services to support our customers’ needs.
Products and Services We offer a wide range of engineered systems, RF and microwave assemblies, advanced interconnect products including PCBs and IC substrates, custom assemblies and integrated systems, passive and advanced ceramic RF components, hi-reliability multi-chip modules, and beamforming and switching networks.
We are in the process of developing the next generation multi-mode maritime and overland surveillance AESA radar known as MOSAIC ® . Surveillance We are a global leader in Identification Friend or Foe (IFF), Monopulse Secondary Surveillance Radars (MSSR), and Air Traffic Control (ATC) systems enabling military and civilian air traffic controllers to effectively identify aircraft and vehicles as friendly.
We are a global leader in IFF, Monopulse Secondary Surveillance Radars (MSSR), and Air Traffic Control (ATC) systems enabling military and civilian air traffic controllers to identify aircraft and vehicles as friendly.
The smaller the traces and the tighter the spaces, the higher the density of the PCB and the greater the expertise required to achieve a desired final yield performance level. We are able to manufacture PCBs with traces and spaces less than 0.030 mm. • High aspect ratios.
Traces are the connecting copper lines between the different components of the PCB, and spaces are the distances between traces. The smaller the traces and the tighter the spaces, the higher the density of the PCB. We are able to manufacture PCBs with traces and spaces less than 0.030 mm. • High aspect ratios.
Our core strategy includes the following elements: Provide differentiated capabilities by incorporating advanced design-to-specification engineering support, testing, components, and specialized assembly into the value-added solution provided to customers. With our acquisition of Anaren in 2018, we moved beyond build-to-print manufacturing and assembly capabilities to engage with customers in designing a more complete RF solution to meet their technology needs.
Our core strategy includes the following elements: Provide differentiated capabilities by incorporating advanced design-to-specification engineering support, testing, components, and specialized assembly into the value-added solution provided to customers.
SLPs are PCBs with even higher interconnect density per unit area than the traditional advanced HDI PCBs described above requiring an even more sophisticated manufacturing technology adapted from IC substrate fabrication with enhancements to the subtractive and additive techniques of traditional PCBs. This enables fine line circuitry (circuit line width and spacing at or less than 0.03 mm).
SLPs represent the next evolution of high-end HDI PCBs with even higher interconnect density per unit area and finer line circuitry (width and spacing at or less than 0.02 mm). They require more sophisticated manufacturing technology adapted from IC substrate fabrication.
Hi-Reliability Multi-Chip Modules We offer custom hybrid and multi-chip modules, high-performance radiation-hardened and space-qualified microelectronics, and power management and control electronics utilizing traditional chip and wire 2D construction as well as 2.5/3DHI advanced packaging assembly.
These products are generally customer-designed for high-performance applications in the medical, industrial, and defense markets. Hi-Reliability Multi-Chip Modules . We provide custom hybrid and multi-chip modules, high-performance radiation-hardened and space-qualified microelectronics, and power management and control electronics utilizing chip and wire 2D construction as well as capability for 2.5DHI advanced packaging assembly. Beamforming and Switching Networks .
The primary raw materials we use in PCB manufacturing include copper clad laminate, chemical solutions such as copper and gold for plating operations, photographic film, carbide drill bits, and plastic for testing fixtures.
Suppliers For advanced interconnect products, primary raw materials include copper clad laminates and chemical solutions such as copper and gold for plating operations, photographic film, carbide drill bits, and plastic for testing fixtures. Most of the raw materials are generally readily available from numerous suppliers in the open market.
We have seen the positive impact of the adjustments we made to base salaries and incentive compensation coupled with the conversations on career opportunities from managers.
Our people leaders are dedicated to engaging with their employees to explain the career framework, their compensation, and potential for future jobs. We have seen the positive impact of the adjustments we made to base salaries and incentive compensation coupled with the managers’ conversations on career opportunities.
For engineered products such as RF subassemblies and systems, we compete with a different set of competitors largely based in the U.S. and Europe. The PCB industry remains fragmented and characterized by intense competition. There are several competitive factors our customers consider when choosing their supplier including, but not limited to, technical capabilities, pricing, service, support, reliability, quality, and location.
Competition For PCBs, our competitors are mostly based in China and Taiwan. For engineered products such as RF subassemblies and systems, we compete with a different set of competitors largely based in the U.S. and Europe. The PCB industry remains highly fragmented and characterized by intense competition.
Supply for PCB materials can vary over time depending on supply/demand dynamics for key raw materials such as copper clad laminates. See Item 1A, Risk Factors for more details. Competition For PCBs, our competitors are mostly based in China and Taiwan.
In addition, we periodically seek alternative supply sources with the goal of ensuring that we are receiving competitive pricing and service. Supply for PCB materials can vary over time depending on supply/demand dynamics for key raw materials such as copper clad laminates. See Item 1A, Risk Factors for more details.
Our Integrated Electronics manufacturing organization principally designs and manufactures state-of-the-art microwave-based hardware for use in advanced radar systems, advanced jamming systems, missiles, and decoys, electronic surveillance systems, and satellite and ground-based communication systems. Several core manufacturing technology areas include: • Electronic Systems Integration.
In circumstances where our customers require time critical engineering and manufacturing services, we are able to react to our customers’ needs with our quick-turn manufacturing capabilities. Our Integrated Electronics manufacturing organization principally designs and manufactures state-of-the-art microwave-based hardware for use in advanced radar systems, advanced jamming systems, missiles, and decoys, electronic surveillance systems, and satellite and ground-based communication systems.
Additionally, due to modernization priorities, an increased proportion of defense budgets is geared towards defense electronics such as radar, communications, and surveillance. These are the key markets for our engineered systems products. TTM’s RF microwave/microelectronic assemblies are also used in complete defense electronic systems and sold to tier one subcontractors.
These are the key markets for our engineered systems products. 4 TTM’s RF microwave/microelectronic assemblies are also used in complete defense electronic systems and sold to tier one subcontractors. They benefit from increasing electronics content in defense programs as well as increased focus on solid-state AESA radar systems.
We are capable of providing a one-stop design, manufacturing, and test solution to our customers with design services, engineering support, and prototype development through final volume production around the globe.
We also offer certain value-added services to support our customers’ needs for RF design-to-specification capability, DFM, PCB layout design, simulation and testing services, and QTA services. We provide a one-stop design, manufacturing, and test solution to our customers with design services, engineering support and prototype development through final volume production around the globe.
By offering this wide range of engineered systems, RF components and subsystems, PCB products, and complementary value-added services, we aim to provide our customers with a “one-stop” manufacturing solution for their hardware technology and integration requirements. We believe this differentiates us from our competition and enhances our customer relationships. Below we describe our product lines in more detail.
We also offer value-added services including DFM, PCB layout design, simulation and testing, QTA production, and specialized RF assembly and testing. By offering this wide range of engineered systems, RF components and subsystems, advanced interconnect products, and complementary value-added services, we provide our customers with a “one-stop” manufacturing solution for their hardware technology and integration requirements.
Navy’s AN/APS-153 multi-mode radar on the MH-60R helicopter, and the communications suite within the MH-60R/S multi-mission helicopters. Our maritime surveillance radars offer advanced features such as Ground Moving Target Indicator (GMTI), Synthetic Aperture Radar (SAR), Inverse Synthetic Aperture Radar (ISAR), Automatic Identification System (AIS), and weather avoidance.
Our multi-mode radars offer advanced features such as Ground Moving Target Indicator (GMTI), Synthetic Aperture Radar (SAR), Inverse Synthetic Aperture Radar (ISAR), Sense and Avoid, Automatic Identification System (AIS), and weather avoidance. Our MOSAIC ® AESA radar family supports maritime surveillance, counter UAS, and advanced air mobility end markets. Surveillance.
Buried vias are holes that do not reach either surface of the PCB but allow inner layers to be interconnected. Products with blind and buried vias can be made thinner, smaller, lighter, and with higher component density and more functionality than products with traditional vias. • Microvias .
Blind vias connect the surface layer of the PCB to an internal layer and terminate at the internal layer. Buried vias are holes that do not reach either surface of the PCB but allow inner layers to be interconnected.
This broad offering allows us to manufacture PCBs for a wide array of end‑use applications, including highly complex PCBs for niche and high-end commercial and aerospace and defense markets. • Quick-turn manufacturing .
We are certified by Underwriters Laboratories to manufacture PCBs using these specialty materials for a wide array of end‑use applications, including highly complex PCBs for niche and high-end aerospace and defense and commercial markets. We also conduct extensive materials testing for internal and customer reference and consideration. • Quick-turn manufacturing .
Our principal PCB and substrate competitors include AT&S (Austria Technologie & Systemtechnik Aktiengesellschaft), Chin-Poon Industrial Co., Ltd., Founder PCB, Gold Circuit Electronics Ltd., ISU Petasys Co., Ltd., Sanmina Corporation, Shennan Circuits Co., Ltd., Suzhou Dongshan Precision Manufacturing Co., Ltd., Tripod Technology Corporation, Unimicron Technology Corporation, Victory Giant Technology, WUS Printed Circuit Co., Ltd., and Zhen Ding Technology Holding Ltd.
Our principal competitors for our Commercial segment include AT&S (Austria Technologie & Systemtechnik Aktiengesellschaft), Founder Technology Group Co., Ltd., Gold Circuit Electronics Ltd., Isu Petasys Co., Ltd., Kinwong Electronic Co. Ltd., Unimicron Technology Corp., Victory Giant Technology Co., Ltd., and WUS Printed Circuit Co., Ltd.
Use of this technology provides greater surface area for surface-mounted ICs and better signal performance, as well as increased functionality of products with higher component density. • Fine line traces and spaces. Traces are the connecting copper lines between the different components of the PCB, and spaces are the distances between traces.
Embedded passive technology involves embedding either capacitive or resistive elements inside the PCB, which leaves more surface area for surface-mounted ICs and better signal performance, as well as increased functionality of products with higher component density. • Fine line traces and spaces.
The aerospace & defense industry in particular provides an opportunity for us as we combine our traditional market strength in core PCB technology with the advanced technologies, RF capabilities and engineered systems we offer for growing requirements in both traditional and AESA radar systems for defense applications. One-stop solution for customers.
We combine our traditional market strength in core PCB technology with advanced technologies, RF capabilities, and engineered systems to grow requirements in both traditional and AESA radar systems for defense applications. We have passed OEM and government certification processes, and the administrative requirements associated with participation in government and commercial aerospace programs.
Our advanced hole fill processes provide methods to allow for vias to be placed inside their respective surface mount pads by filling the vias with a thermoset epoxy and plating flat copper surface mount pads directly over the filled hole. 9 • Advanced materials . We manufacture circuit boards using a wide variety of advanced dielectric materials.
Core thickness in our PCBs ranges from as little as 0.025 mm up to 1.57 mm. • Advanced hole fill processes. Our advanced hole fill processes allows for vias to be placed inside their respective surface mount pads by filling the vias with a thermoset epoxy and plating flat copper surface mount pads directly over the filled hole.
To ensure focus on individual development for growth and readiness for career opportunities, we track the completion of 14 development plans of our employees in management, technical, and professional career tracks, with over 91% documented plans in 2024.
We ensure focus on individual career development through regular talent reviews of performance, potential, development gaps, and progress to evaluate the depth and strength of our integrated succession plans. We track the completion of development plans for our employees in management, technical, and professional career tracks.
We provide both equipment and supporting services required to safely and reliably control flight operations. These systems are used by the U.S. Army, U.S. Navy, U.S. Air Force, U.S. Marines, Federal Aviation Administration (FAA), North Atlantic Treaty Organization (NATO), and numerous international defense agencies including those of Japan and South Korea.
Our active and passive surveillance solutions are used by all branches of the U.S. military, Federal Aviation Administration (FAA), North Atlantic Treaty Organization (NATO), and numerous international defense agencies including those of Japan and South Korea. Communications Systems.
Our highly specialized equipment and advanced manufacturing processes enable us to reliably produce PCBs with the following characteristics: • High layer count. Manufacturing PCBs with a large number of layers is difficult to accomplish due to the accumulation of manufacturing tolerances and registration systems required.
We also use automated optical inspection systems and electrical testing systems to ensure consistent quality of the circuits we produce. Our highly specialized equipment and advanced manufacturing processes enable us to reliably produce PCBs with the following characteristics: • High layer count.
Combined with the engineered systems and assemblies described earlier, we collectively refer to all of these technologies as “advanced technologies", and they generally have growth rates which are higher than conventional technologies.
Combined with the engineered systems and assemblies described above, these “advanced technologies" generally have growth rates which are higher than conventional technologies. In addition, most of our markets have low volume requirements during the prototype stage, which later transitions to higher volume requirements during product ramp.
We believe that our global manufacturing footprint and breadth of capabilities enables us to serve multiple key end markets for our technology solutions.
Leading aerospace and defense supplier. We are a trusted supplier to the aerospace and defense industry. Our global manufacturing footprint and breadth of capabilities enable us to serve multiple key end markets, particularly the aerospace and defense industry.
We provide recurring instructor-led, blended learning, online courses, and development programs for different stages of leadership including new people leaders through more senior leaders. Additionally, we extend competency-based training, sponsor job rotations, and form project teams comprised of emerging talent. We provide tuition reimbursement assistance, as well as a monthly stipend to engineers to pay down student debt.
For different levels of leaders, we provide recurring instructor-led learning, online courses, and leadership programs. Additionally, we offer competency-based training, sponsor job rotations, form project teams comprised of emerging talent, and provide extensive internal and external materials in our global learning management system. We provide tuition reimbursement assistance. Inclusion.
We recently deployed customized equipment to support automated test, visual and electrical inspection, and final tape-and-reel for ceramic resistor products significantly reducing cost and enhancing product quality. Customers and Markets Our customers include end-users, OEMs, EMS providers, ODMs, and distributors that primarily serve the aerospace and defense, automotive, data center computing, medical/industrial/instrumentation, and networking end markets of the electronics industry.
Customers and Markets Our customers include end-users, OEMs, EMS providers, ODMs, and distributors that primarily serve the aerospace and defense, automotive, data center computing, medical, industrial, and instrumentation, and networking end markets of the electronics 8 industry. Included in the end markets that our OEM and EMS customers serve is the USG.
RF and Microwave Assemblies We design, produce, and test specialized circuits and components used in radio frequency or microwave emission and collection applications. These products are typically used for radar, transmit/receive antennas and similar wireless applications. Markets for these products include defense, avionics, satellite, and commercial applications including telecommunications, networking, instrumentation, and automotive.
We design, produce, and test specialized multi-chip RF modules and components used for radar, transmit/receive antennas, and similar wireless applications. We serve defense, avionics, satellite, and commercial applications including telecommunications, networking, instrumentation, and automotive. We also offer specialized radio frequency assembly, test services, and integrated solutions to provide sophisticated integrated electronics for numerous platforms. Passive RF Components .
Maintain our customer-driven culture and provide superior service to our customers in our core markets of aerospace and defense, automotive, data center computing, medical/industrial/instrumentation, and networking. Our customer-oriented culture is designed to achieve extraordinary service, competitive differentiation, and superior execution.
As a result of additional design capabilities, we are more capable of providing cost-effective, ready for manufacture, enabling technologies to the customer. Maintain our customer-driven culture and provide superior service to our customers in our core markets of aerospace and defense, automotive, data center computing, medical, industrial, and instrumentation, and networking.
Processing these data files with computer aided manufacturing (CAM) technology, we generate images of the circuit patterns that we then physically develop on individual layers, using advanced photographic and direct imaging processes.
We manufacture advanced interconnect products according to customer circuit designs, which we review to ensure data accuracy and product manufacturability. With computer aided manufacturing (CAM) technology, we develop circuit patterns on individual layers using advanced photographic and direct imaging processes.
Talent Acquisition. Our vision is to provide exceptional talent acquisition, recognized for our commitment to engaging with and building robust talent sources, the optimized use of technology, and a compelling employment brand. We aspire to create a seamless and candidate-centric experience that not only meets the needs of TTM globally, but also ensures a positive and engaging journey.
Our vision is to provide exceptional talent acquisition through robust talent sources, use of technology, and a compelling employment brand to create a seamless, engaging, and candidate-centric experience. We aim to build a workforce that drives the company's success and fosters a culture of growth and opportunity. Talent Development.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures or to dispose of material assets or operations, seek additional capital (which could include obtaining additional equity capital on terms that may be onerous or highly dilutive) or restructure or refinance our indebtedness.
If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and be forced to reduce or delay investments and capital expenditures, dispose of material assets or operations, seek additional capital (which could include obtaining additional equity capital on terms that may be onerous or highly dilutive), or restructure or refinance our indebtedness.
If we are unable to appropriately assess a cybersecurity incident in the context of required analyses then we could face compliance issues under these laws and regulations, and we could be subject to lawsuits, regulatory fines or investigations, or other liabilities, any or all of which could adversely affect our business and operating results.
If we are unable to appropriately assess a cybersecurity incident in the context of required analyses then we could face compliance issues under these laws and regulations, and we could be subject to lawsuits, regulatory fines, investigations, or other liabilities, any or all of which could adversely affect our business and operating results.
Other Risks Outages, computer viruses, cyber-attacks, and similar cybersecurity threats could materially disrupt our operations, and breaches of our information systems may cause us to incur significant legal and financial exposure. We rely on information technology (IT) networks and systems, some of which are owned and operated by third parties, to collect, process, transmit, and store electronic information.
Other Risks Outages, computer viruses, cyber-attacks, and similar cybersecurity threats could materially disrupt our operations, and breaches of our information systems may cause us to incur significant legal and financial exposure. We rely on IT networks and systems, some of which are owned and operated by third parties, to collect, process, transmit, and store electronic information.
The 20 termination or failure to fund one or more significant defense programs or contracts by the U.S. federal government could have a material adverse effect on our business, financial condition, and results of operations. Future changes to the U.S. Munitions List could reduce or eliminate restrictions that currently apply to some of the products we produce.
The termination or failure to fund one or more significant defense programs or contracts by the U.S. federal government could have a material adverse effect on our business, financial condition, and results of operations. Future changes to the U.S. Munitions List could reduce or eliminate restrictions that currently apply to some of the products we produce.
The capital expenditure costs expected for environmental improvement initiatives are included in our annual capital expenditure projections. Our international sales are subject to laws and regulations relating to corrupt practices, trade and export controls, and economic sanctions. Any non-compliance could have a material adverse effect on our business, financial condition, and results of operations.
The capital expenditure costs expected for environmental improvement initiatives are included in our annual capital expenditure projections. 21 Our international sales are subject to laws and regulations relating to corrupt practices, trade and export controls, and economic sanctions. Any non-compliance could have a material adverse effect on our business, financial condition, and results of operations.
If the labor markets remain tight and we are unable to adequately staff our facilities due to a shortage of qualified workers, our operations and financial performance would likely be adversely affected. 26 Our business, financial condition, and results of operations could be materially adversely affected by initiatives aimed at addressing potential climate change risks.
If the labor markets remain tight and we are unable to adequately staff our facilities due to a shortage of qualified workers, our operations and financial performance would likely be adversely affected. Our business, financial condition, and results of operations could be materially adversely affected by initiatives aimed at addressing potential climate change risks.
There can be no assurance that key customers would not cancel orders, that they would continue to place orders with us in the future at the same levels as experienced by us in prior periods, that they would be able to meet their 22 payment obligations, or that the end-products that use our products would be successful.
There can be no assurance that key customers would not cancel orders, that they would continue to place orders with us in the future at the same levels as experienced by us in prior periods, that they would be able to meet their payment obligations, or that the end-products that use our products would be successful.
In this competitive environment, our business could be adversely impacted by increases in labor costs, which could include increases in wages and benefits necessary to attract and retain high-quality employees with the right skill sets, increases triggered by regulatory actions regarding wages, scheduling, and benefits; and increases in health care and workers’ compensation insurance costs.
In this labor environment, our business could be adversely impacted by increases in labor costs, which could include: increases in wages and benefits necessary to attract and retain high-quality employees with the right skill sets; increases triggered by regulatory actions regarding wages, scheduling, and benefits; and increases in health care and workers’ compensation insurance costs.
Despite progress in developing its legal system, certain countries in Asia do not have a comprehensive and highly developed system of laws, particularly with respect to foreign investment 29 activities and foreign trade. Enforcement of existing and future laws and contracts is uncertain, and implementation and interpretation thereof may be inconsistent.
Despite progress in developing its legal system, certain countries in Asia do not have a comprehensive and highly developed system of laws, particularly with respect to foreign investment activities and foreign trade. Enforcement of existing and future laws and contracts is uncertain, and implementation and interpretation thereof may be inconsistent.
If we were to lose automotive customers due to quality control issues, we might not be able to regain those customers or gain new automotive customers for long periods of time, which could have a material adverse effect on our business, financial condition, and results of operations.
If we were to lose automotive customers due to quality control issues, we might not be able to regain those customers or gain new automotive customers for long periods of time, which could have a material adverse effect on our financial condition and/or results of operations.
In Asia, the government has a history of changing legal 30 requirements with no or minimal notice. We believe that our facilities in Asia comply in all material respects with current applicable environmental laws and regulations and have resources in place to maintain compliance to them.
In Asia, the government has a history of changing legal requirements with no or minimal notice. We believe that our facilities in Asia comply in all material respects with current applicable environmental laws and regulations and have resources in place to maintain compliance to them.
As a result, we may need to continue to seek new locations with lower costs and the employee and infrastructure base to support PCB manufacturing and we may lose business in our existing facilities as a result of such potential shifts in the market.
As a result, we may need to seek new locations with lower costs and the employee and infrastructure base to support PCB manufacturing and we may lose business in our existing facilities as a result of such potential shifts in the market.
Proposed and existing legislative efforts to control or limit greenhouse gas emissions could affect our energy sources and supply choices, as well as increase the cost of energy and raw materials that are derived from sources that generate greenhouse gas emissions.
Proposed and existing legislative efforts to 18 control or limit greenhouse gas emissions could affect our energy sources and supply choices, as well as increase the cost of energy and raw materials that are derived from sources that generate greenhouse gas emissions.
Furthermore, we have limited patent or trade secret protection for our manufacturing processes and rely on the collective experience of our employees involved in our manufacturing processes to ensure that we continuously evaluate and adopt new technologies in our industry.
We have limited patent or trade secret protection for our manufacturing processes and rely on the collective experience of our employees involved in our manufacturing processes to ensure that we continuously evaluate and adopt new technologies in our industry.
If either of these situations occurs, our financial condition and results of operations could be negatively impacted. If we are unable to maintain satisfactory capacity utilization rates, our business, financial condition, and results of operations would be materially adversely affected.
If either of these situations occurs, our financial condition and results of operations could be negatively impacted. 14 If we are unable to maintain satisfactory capacity utilization rates, our business, financial condition, and results of operations would be materially adversely affected.
In addition, in the ordinary course of our business, we collect and store sensitive data in our data centers and on our networks, including intellectual property, our proprietary and confidential business information and that of our customers, suppliers and business partners, and personally identifiable information of our employees.
In the ordinary course of our business, we collect and store sensitive data in our data centers and on our networks, including intellectual property, our proprietary and confidential business information and that of our customers, suppliers and business partners, and personally identifiable information of our employees.
Fluctuations in the exchange rates between the U.S. dollar and the RMB could result in increases or decreases in our costs or revenues which could negatively impact our business, financial condition, and results of operations.
Fluctuations in the exchange rates between the U.S. dollar and the RMB and/or the MYR could result in increases in our costs or decreases in our revenues which could negatively impact our business, financial condition, and results of operations.
Also, the evolving landscape of the interrelation between China and Hong Kong may have an adverse impact on our operations in Hong Kong and may impact our ability to attract and maintain necessary talent in that area.
Also, the evolving landscape of the interrelation between 20 China and Hong Kong may have an adverse impact on our operations in Hong Kong and may impact our ability to attract and maintain necessary talent in that area.
Some of our competitors and potential competitors have advantages over us, including: • greater financial and manufacturing resources that can be devoted to the development, production, and sale of their products; • more established and broader sales and marketing channels; • more manufacturing facilities worldwide, some of which are closer in proximity to OEMs; • manufacturing facilities that are located in countries with lower production costs; • lower capacity utilization, which in peak market conditions can result in shorter lead times to customers; • ability to add additional capacity faster or more efficiently; • preferred vendor status with existing and potential customers; • greater name recognition; and • larger customer bases.
Some of our competitors and potential competitors have advantages over us, including: greater financial and manufacturing resources that can be devoted to the development, production, and sale of their products; more established and broader sales and marketing channels; preferred vendor status with existing and potential customers; more manufacturing facilities worldwide, some of which are closer in proximity to OEMs and/or located in countries with lower production costs; lower capacity utilization, which in peak market conditions can result in shorter lead times to customers; ability to add capacity faster or more efficiently; and larger customer bases.
Competition in the PCB market is intense, and we could lose market share, or our profit margins may decrease, if we are unable to maintain our current competitive position in end markets using our quick-turn, high-technology, and high-mix manufacturing services. The PCB industry is intensely competitive, highly fragmented, and rapidly changing.
Competition in the PCB and worldwide electronics market is intense, and we could lose market share, or our profit margins may decrease, if we are unable to maintain our current competitive position in end markets using our quick-turn, high-technology, and high-mix manufacturing services. The PCB industry is intensely competitive, highly fragmented, and rapidly changing.
In particular, we depend on our information systems for a variety of functions, including worldwide financial reporting, inventory management, procurement, invoicing, and email communications. These information systems are susceptible to outages due to fire, floods, power loss, telecommunications failures, hacking, terrorist attacks, and similar cybersecurity threats.
We depend on our information systems for a variety of functions, including worldwide financial reporting, inventory management, procurement, invoicing, and email communications. These information systems are susceptible to outages due to fire, floods, power loss, telecommunications failures, hacking, terrorist attacks, and similar cybersecurity threats.
If raw material and component prices remain elevated and the cost of the metals that we use to produce our product, especially if the prices of copper, gold, tin, palladium, and other precious metals we use to manufacture our products remain elevated or otherwise continue to increase, it may reduce our gross margins.
If raw material and component prices remain elevated and the cost of the metals that we use to produce our product, especially the prices of copper, gold, tin, palladium, and other precious metals remain elevated or otherwise continue to increase, it may reduce our gross margins.
As the legal system develop, the promulgation of new laws, changes to existing laws, and the preemption of local regulations by national laws may adversely affect foreign investors. Further, any litigation may be protracted and may result in substantial costs and diversion of resources and management’s attention.
As the legal system develops, the promulgation of new laws, changes to existing laws, and the preemption of local regulations by national laws may adversely affect foreign investors. Further, any litigation may be protracted and may result in substantial costs and diversion of resources and management’s attention.
The annual limitation for a taxable year is generally increased by the amount of any “recognized built‑in gains” for such year and the amount of any unused annual limitation in a prior year. As a result of our acquisition of Viasystems, the NOLs acquired were subject to this limitation.
The annual limitation for a taxable year is generally increased by the amount of any “recognized built‑in gains” for such year and the amount of any unused annual limitation in a prior year. As a result of our acquisition of Viasystems Group, Inc., the NOLs acquired were subject to this limitation.
In turn, our ability to maintain satisfactory capacity utilization will depend on the demand for our products, the volume of orders we receive, our ability to maintain a sufficient workforce at our facilities, and our ability to offer products that meet our customers’ requirements at competitive prices.
Our ability to maintain satisfactory capacity utilization will depend on the demand for our products, the volume of orders we receive, our ability to maintain a sufficient workforce at our facilities, and our ability to offer products that meet our customers’ requirements at competitive prices.
The secure collection, processing, storage, maintenance, and transmission of this information is critical to our operations.
The secure collection, processing, storage, maintenance, and transmission of this information is critical 22 to our operations.
An investment in our common stock involves a high degree of risk. You should carefully consider the factors described below, in addition to those discussed elsewhere in this Report, in analyzing an investment in our common stock.
ITEM 1A. RISK FACTORS An investment in our common stock involves a high degree of risk. You should carefully consider the factors described below, in addition to those discussed elsewhere in this Report, in analyzing an investment in our common stock.
Under U.S. federal income tax law, a corporation’s ability to utilize its net operating losses (NOLs) to offset future taxable income may be significantly limited if it experiences an “ownership change” as defined in Section 382 of the Internal Revenue Code of 1986, as amended.
Under U.S. federal income tax law, a corporation’s ability to utilize its NOLs to offset future taxable income may be significantly limited if it experiences an “ownership change” as defined in Section 382 of the Internal Revenue Code of 1986, as amended.
In addition, during industry downturns, we may need to reduce prices to limit the level of order losses, and we may be unable to collect payments from our customers.
During industry downturns, we may need to reduce prices to limit the level of order losses, and we may be unable to collect payments from our customers.
However, if unauthorized parties gain material access to our information systems or material information is used in an unauthorized manner, misdirected, altered, lost, or stolen during transmission, any theft or misuse of such information could result in, among other things, unfavorable publicity, governmental inquiry and oversight, difficulty in marketing our services, allegations by our customers that we have not performed our contractual obligations, loss of customers, litigation by affected parties, and possible financial obligations for damages related to the theft or misuse of such information, any of which could have a material adverse effect on our business, financial condition, and results of operations.
However, if unauthorized parties gain material access to our information systems or material information is used in an unauthorized manner, misdirected, altered, lost, or stolen, it could result in unfavorable publicity, governmental inquiry and oversight, difficulty in marketing our services, allegations by our customers that we have not performed our contractual obligations, loss of customers, litigation by affected parties, and possible financial obligations for damages related to the theft or misuse of such information, any of which could have a material adverse effect on our business, financial condition, and results of operations.
We rely on suppliers and equipment manufacturers for the timely delivery of raw materials, components, equipment, and spare parts used in manufacturing our PCBs.
We rely on suppliers and equipment manufacturers for the timely delivery of raw materials, components, equipment, and spare parts used in manufacturing our products.
Significant inflation or disproportionate changes in foreign exchange rates could occur as a result of general economic conditions, acts of war or terrorism, changes in governmental monetary or tax policy, or changes in local interest rates. Further, China’s government imposes controls over the convertibility of RMB into foreign currencies, which subjects us to further currency exchange risk.
Significant inflation or disproportionate changes in foreign exchange rates could occur from general economic conditions, acts of war or terrorism, changes in governmental monetary or tax policy, or changes in local interest rates. Further, China’s government imposes controls over the convertibility of RMB into foreign currencies, which subjects us to further currency exchange risk.
Uncertainty, volatility, or adverse changes in the economy could lead to a significant decline in demand for the end products manufactured by our customers, which, in turn, could result in a decline in the demand for our products and increase pressure to reduce our prices.
Uncertainty, volatility, or adverse changes in the global economy could lead to a significant decline in demand for the end products manufactured by our customers, which, in turn, could result in a decline in the demand for our products and increased pressure to reduce our prices.
Many countries are considering implementing or have implemented legislation to align their tax law with guidance proposed by the Organization for Economic Co-operation and Development (OECD). In particular, the OECD’s Pillar Two proposes a global minimum tax of 15% on a country-by-country basis for multinational enterprises (MNEs) which have annual global revenue exceeding Euro (EUR) 750 million.
Many countries are considering implementing or have implemented legislation to align their tax law with guidance proposed by the OECD. In particular, the OECD’s Pillar Two proposes a global minimum tax of 15% on a country-by-country basis for multinational enterprises (MNEs) which have annual global revenue exceeding Euro (EUR) 750 million.
Sales to EMS companies represented approximately 28%, 31%, and 37% of our net sales for the years ended December 30, 2024, January 1, 2024, and January 2, 2023, respectively. Sales to EMS providers include sales directed by OEMs as well as orders placed with us at the EMS providers’ discretion.
Sales to EMS companies represented approximately 30%, 28%, and 31% of our net sales for the years ended December 29, 2025, December 30, 2024, and January 1, 2024, respectively. Sales to EMS providers include sales directed by OEMs as well as orders placed with us at the EMS providers’ discretion.
Defects in the products we manufacture, whether caused by a design, manufacturing, or materials failure or error, may result in delayed shipments, customer dissatisfaction, a reduction or cancellation of purchase orders, or liability claims against us.
Defects in our products, whether caused by a design, manufacturing, or materials failure or error, may result in delayed shipments, customer dissatisfaction, a reduction or cancellation of purchase orders, or liability claims against us.
Our global business operations must also comply with all applicable domestic and foreign export control laws, including International Traffic In Arms Regulations (ITAR) and Export Administration Regulations (EAR). Some items we manufacture are controlled for export by the U.S. Department of Commerce’s Bureau of Industry and Security under EAR.
Our global business operations must also comply with all applicable domestic and foreign export control laws, including ITAR and EAR. Some items we manufacture are controlled for export by the U.S. Department of Commerce’s Bureau of Industry and Security under EAR.
In addition, for the year ended December 30, 2024, we generated approximately 47% of our net sales from non-U.S. operations, and a significant portion of our manufacturing material was provided by international suppliers during this period.
In addition, for the year ended December 29, 2025, we generated approximately 50% of our net sales from non-U.S. operations, and a significant portion of our manufacturing material was provided by international suppliers during this period.
We operate on a global basis and are subject to anti-corruption, anti-bribery, and anti-kickback laws and regulations, including restrictions imposed by the Foreign Corrupt Practices Act (FCPA).
We operate on a global basis and are subject to anti-corruption, anti-bribery, and anti-kickback laws and regulations, including restrictions imposed by the FCPA.
If a raw material supplier or equipment manufacturer goes bankrupt, liquidates, consolidates out of existence, experiences excess demands or other disruptions to their supply chain or operations, or otherwise fails to satisfy our product quality standards, or if the prices or availability of raw materials change, it could harm our ability to purchase new manufacturing equipment, service the equipment we have, or timely produce our products, thereby affecting our customer relationships.
If a raw material supplier or equipment manufacturer experiences disruptions to their supply chain or operations, or otherwise fails to satisfy our product quality standards, or if the prices or availability of raw materials change, it could harm our ability to purchase new manufacturing equipment, service the equipment we have, or timely produce our products, thereby affecting our customer relationships.
Many U.S. and foreign laws and regulations, including those promulgated by the SEC, require companies to provide notice of cybersecurity incidents involving certain types of personal data or unauthorized access to, or interference with, our information systems to the public, certain individuals, the media, government authorities, or other third parties.
Many U.S. and foreign laws and regulations require companies to provide notice of cybersecurity incidents involving certain types of personal data or unauthorized access to, or interference with, our information systems to the public, government authorities, or other third parties.
Furthermore, cybersecurity incidents experienced by us, or by our customers or vendors, that lead to public disclosures may also lead to widespread negative publicity and increased government or regulatory scrutiny.
Furthermore, cybersecurity incidents experienced by us, or by our customers and vendors, that lead to public disclosures may also lead to widespread negative publicity and increased government or regulatory scrutiny. Cybersecurity incidents may result in increased costs for cybersecurity insurance.
As part of our business strategy, we expect that we will continue to implement and align our strategy by pursuing potential divestitures of assets, such as our sale of Shanghai Backplane Assembly, and acquisitions of businesses, technologies, assets, or product lines that complement or expand our business, such as our acquisition of Gritel Holding Co., Inc.
As part of our business strategy, we expect that we will continue to implement and align our strategy by pursuing potential divestitures of assets, such as our sale of Shanghai Backplane Assembly, and acquisitions of businesses, technologies, assets, or product lines that complement or expand our business, such as our acquisition of Telephonics in 2022.
If we were to violate the terms and requirements of the SBR, the NISPOM, or any other applicable U.S. government industrial security regulations (which may apply to us under the terms of classified contracts), we could lose our security clearance. We cannot be certain that we will be able to maintain our security clearance.
If we were to violate the terms and requirements of the SBR, the NISPOM, or any other applicable U.S. government industrial security regulations (which may apply to us under the terms of classified contracts), we could lose our security clearance.
Our success is due in part to our ability to deliver products timely to our customers, which requires successful planning and logistics infrastructure, including, ordering, transportation and receipt processing, and the ability of suppliers to meet our materials requirements.
Our success depends on our ability to deliver products timely to our customers, which requires successful planning and logistics infrastructure, including, ordering, transportation and receipt processing, and the ability of suppliers to meet our materials requirements.
This concentration of customer base may materially adversely affect our business, financial condition, and results of operations due to the loss or cancellation of business from any of these key customers, significant changes in scheduled deliveries to any of these customers, or decreases in the prices of the products sold to any of these customers.
This concentration of customer base may materially adversely affect our business, financial condition, and results of operations due to: the loss or cancellation of business from any of our key customers; a decline in sales, decreases in prices, or significant changes in scheduled deliveries of our products to our significant customers; or the insolvency of one or more of our significant customers.
Moreover, if any of our OEM customers outsource the production of PCBs and creation of backplane assemblies to these EMS providers, our business, financial condition, and results of operations may be materially adversely affected. The worldwide electronics industry is intensely competitive and volatile.
Moreover, if any of our OEM customers outsource the production of PCBs and creation of backplane assemblies to these EMS providers, our business, financial condition, and results of operations may be materially adversely affected.
We cannot assure investors that we will realize the anticipated strategic benefits of our new locations, or that such locations will contribute positively to our operating results. In North America, we are experiencing wage inflation pressures, as a result of labor shortages, and certain pressures which are also mandated by local and state governments.
We cannot assure investors that we will realize the anticipated strategic benefits of our new locations, or that such locations will contribute positively to our operating results. In North America, we are experiencing labor shortages in certain sectors, rising health care costs, and certain pressures which are also mandated by local and state governments.
We may not be able to affect any such alternative measures, if necessary, on commercially reasonable terms or at all and, even if successful, those alternative actions may not allow us to meet our scheduled debt service obligations. The credit agreements governing the Term Loan Facility, the U.S.
We may not be able to affect any such alternative measures and, even if successful, those alternative actions may not allow us to meet our scheduled debt service obligations. Additionally, the credit agreements governing the Term Loan Facility, the U.S.
Risks and uncertainties not known to us currently, or that may appear immaterial, also may have a material adverse effect on our business, financial condition, and results of operations.
Risks and uncertainties not known to us currently, or that may appear immaterial, also may have a material adverse effect on our business, financial condition, and results of operations. Risks Related to our Business Global economic and market uncertainty may adversely impact our business and operating results.
Failure to meet these standards may adversely affect our business, financial condition, and results of operations. Our customer base demands the highest customer service, on time delivery and quality standards in a competitive market.
We participate in competitive industries, including the automotive industry, which requires strict quality control standards. Failure to meet these standards may adversely affect our business, financial condition, and results of operations. Our customer base demands the highest customer service, on time delivery, and quality standards in a competitive market.
In addition, we are subject to risks relating to significant international operations, including but not limited to: • managing international operations; • imposition of governmental controls; • unstable regulatory environments; • compliance with employment laws; • implementation of disclosure controls, internal controls, financial reporting systems, and governance standards to comply with U.S. accounting and securities laws and regulations; • limitations on imports or exports of our product offerings; • fluctuations in the value of local currencies; • inflation or changes in political and economic conditions; • public health crises; • labor unrest, rising wages, difficulties in staffing, and geographical labor shortages; • government or political unrest; • conflict or war between nations over territory that impacts the electronics supply chain leading to potential trade restrictions to and from the nations involved, including Russia, Ukraine, and China; • longer payment cycles; • language and communication barriers, as well as time zone differences; • cultural differences; • increases in duties and taxation levied on our products; • other potentially adverse tax consequences; • imposition of restrictions on currency conversion or the transfer of funds; • travel restrictions; • expropriation of private enterprises; • the potential reversal of current favorable policies encouraging foreign investment and trade; 19 • the potential for strained trade relationships between the United States and its trading partners, including trade tariffs which could create competitive pricing risk; and • government imposed sanction laws and regulations.
In addition, we are subject to risks relating to significant international operations, including but not limited to: managing international operations and longer payment cycles; imposition of governmental controls, unstable regulatory environments, and government or political unrest; limitations on imports or exports and/or increases in duties and taxation levied on our products; inflation or changes in political and economic conditions; labor unrest, rising wages, difficulties in staffing, geographical labor shortages, and compliance with employment laws; conflict or war between nations over territory that impacts the electronics supply chain leading to potential trade restrictions to and from the nations involved, including Russia, Ukraine, and China; language, communication, and cultural barriers, as well as time zone differences; potentially adverse tax consequences; expropriation of private enterprises; strained trade relationships between the United States and its trading partners, including trade tariffs which could create competitive pricing risk; and government imposed sanction laws and regulations. 13 We are subject to risks of currency exchange rate fluctuations.
A significant portion of our operating expenses are relatively fixed in nature, and planned expenditures are based in part on anticipated orders. Accordingly, unexpected revenue shortfalls may decrease our operating margins.
A significant portion of our operating expenses are relatively fixed in nature, and planned expenditures are based in part on anticipated orders.
Consolidations and restructuring in our supplier base and equipment fabricators related to our raw materials purchases or the manufacturing equipment we use to fabricate our products may result in adverse changes in pricing of materials due to reduction in competition among our raw material suppliers or an elimination or shortage of equipment and spare parts from our manufacturing equipment supply base.
Consolidations and restructuring in our supplier base and equipment fabricators related to our raw materials purchases or the manufacturing equipment we use to fabricate our products may result in adverse changes in pricing due to reduced competition and shortages of equipment and spare parts.
We are exposed to the credit risk of our customers and to credit exposures in weakened markets. Most of our sales are on an “open credit” basis, with standard industry payment terms.
These events could adversely affect our business, operations, financial condition, and results of operations. We are exposed to the credit risk of our customers and to credit exposures in weakened markets. Most of our sales are on an “open credit” basis, with standard industry payment terms.
The future success of our business will depend in large part upon our ability to maintain and enhance our technological capabilities, to design and manufacture products that meet changing customer needs, and to successfully anticipate or respond to technological changes on a cost-effective and timely basis.
Our future success highly depends on our ability to maintain and enhance our technological capabilities, design and manufacture products that meet changing customer needs, and successfully anticipate or respond to technological changes on a cost-effective and timely basis.
We and some of our competitors have reduced average selling prices in the past. In addition, competitors may reduce their average selling prices faster than our ability to reduce costs, which can also accelerate the rate of decline of our selling prices. When prices decline, we may also be required to write down the value of our inventory.
Competitors may reduce their average selling prices faster than our ability to reduce costs, which can also accelerate the rate of decline of our selling prices and result in lower or no profit from sales. When prices decline, we may also be required to write down the value of our inventory.
Should the supply of materials used in the above manufacturing processes become limited, our ability to obtain the quantities necessary to meet our customers’ demand may be impacted which could cause us to encounter reduced revenue levels or price increases which would impact our profit margins.
Should the supply of materials used in our manufacturing processes become limited, our ability to obtain the quantities necessary to meet our customers’ demand may be impacted, which would impact our profit margins.
Any increase in labor costs due to minimum wage laws or customer requirements about scheduling and overtime that we are unable to recover in our pricing to our customers could materially adversely affect our business, financial condition, and results of operations.
In some cases, employers have responded by significantly increasing the wages of workers at such plants. Any increase in labor costs due to minimum wage laws or customer requirements about scheduling and overtime that we are unable to recover in our pricing to our customers could materially adversely affect our business, financial condition, and results of operations.
In light of the current challenging labor market conditions, our wages and benefits programs and any steps we take to increase our wages and benefits, may be insufficient to attract and retain talent at all levels of our organization.
In light of the current labor market conditions and existing labor shortages, our wages and benefits programs, and any steps we take to increase our wages and benefits, may be insufficient to attract and retain talent at all levels of our organization, which could adversely affect our production, overall business, and financial performance.
Uncertainty and adverse changes in the economy could also increase the cost and decrease the availability of potential 18 sources of financing and increase our exposure to losses from bad debts, either of which could have a material adverse effect on our financial condition, operating results, and cash flows.
These adverse global economic conditions could also increase the cost and decrease the availability of potential sources of financing and increase our exposure to losses from bad debts. All of these impacts could have a material adverse effect on our financial condition, operating results, and cash flows.
Our five largest OEM customers collectively accounted for approximately 42%, 41%, and 33% of our net sales for the years ended December 30, 2024, January 1, 2024, and January 2, 2023, respectively, and one customer represented 11% of our net sales for the year ended December 30, 2024.
Our five largest OEM customers collectively accounted for approximately 44%, 42%, and 41% of our net sales for the years ended December 29, 2025, December 30, 2024, and January 1, 2024, respectively, and two customers collectively represented 23% of our net sales for the year ended December 29, 2025.
There can be no assurance that we will be able to do so in the future, and failure to do so could jeopardize our expansion plans and seriously harm our operations. In addition, growth in our capacity could result in reduced capacity utilization and a corresponding decrease in gross margins.
There can be no assurance that we will be able to do so in the future, and failure to do so could jeopardize our expansion plans and seriously harm our operations.
We are increasingly required to certify compliance with various material content restrictions in our products based on laws of various jurisdictions or territories such as the Restriction of Hazardous Substances (RoHS) and Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) directives in the European Union and China’s RoHS legislation.
We are increasingly required to certify compliance with various material content restrictions in our products based on laws of various jurisdictions or territories such as the RoHS and REACH directives in the European Union and China’s RoHS legislation. Similar laws have been adopted in other jurisdictions and may become increasingly prevalent.
We must survey our supply chain and certify to the non‑presence or presence of SVHCs to our customers. As with other types of product certifications that we routinely provide, we may incur liability and pay damages if our products do not conform to our certifications.
As with other types of product certifications that we routinely provide, we may incur liability and pay damages if our products do not conform to our certifications.
Suppliers and equipment manufacturers may be impacted by other events outside our control including macroeconomic events, financial instability, environmental occurrences, or supplier interruptions due to fire, natural catastrophes, public health crises or otherwise. Several of these factors have contributed to supply chain constraints we continue to experience.
Suppliers and equipment manufacturers may be impacted by other events outside our control, including macroeconomic events, financial instability, liquidation, environmental occurrences, public health crises, or interruptions due to fire, natural catastrophes, or otherwise.
We rely on a combination of copyright, patent, trademark, trade secret laws, confidentiality procedures, contractual provisions, and other measures to establish and protect our proprietary and confidential information. All of these measures afford only limited protection.
We rely on a combination of copyright, patent, trademark, trade secret laws, confidentiality procedures, contractual provisions, and other measures to establish and protect our proprietary and confidential information. All of these measures afford only limited protection. These measures may be invalidated, circumvented, breached, or challenged, and others may develop similar or superior intellectual property, technologies, or processes.
In addition, vehicle manufacturers, which have traditionally borne the costs associated with warranty programs offered on their vehicles, are increasingly requiring suppliers to guarantee or warrant their products and may seek to hold us responsible for some or all of the costs related to the repair and replacement of parts supplied by us to the vehicle manufacturer.
In addition, vehicle manufacturers, which have traditionally borne the costs associated with warranty programs offered on their vehicles, are increasingly requiring suppliers to guarantee or warrant their products and may seek to hold us responsible for some or all of the costs related to the repair and replacement of parts supplied by us to the vehicle manufacturer. 16 Damage to any of our manufacturing facilities due to fire, natural disaster, or other events could materially adversely affect our business, financial condition, and results of operations.
China has put in place a comprehensive system of intellectual property laws; however, incidents of infringement are relatively common, and enforcement of rights can, in practice, be difficult.
China has put in place a comprehensive system of intellectual property laws; however, incidents of infringement are relatively common, and enforcement of rights can, in practice, be difficult. If we are unable to manage our intellectual property rights, our business and operating results may be seriously harmed.
With a high level of fixed operating costs, even small revenue shortfalls would decrease our operating margins.
Our results of operations are often subject to demand fluctuations. With a high level of fixed operating costs, even small revenue shortfalls would decrease our operating margins.
In addition, our failure to adopt and implement technological improvements quickly may cause inefficiencies in our production process as our product yields or quality may decrease, resulting in increased costs, and may lead to customers not adopting our product designs.
In addition, our failure to adopt and implement technological improvements quickly may cause inefficiencies in our production process as our product yields or quality may decrease, resulting in increased costs, and may lead to customers not adopting our product designs. New emerging technology trends, such as AI, require us to keep pace with evolving regulations and industry standards.
Our ability to make scheduled payments on or to refinance our debt obligations and to fund planned capital expenditures and expansion efforts depends on our ability to generate cash in the future and our financial condition and operating performance, which are subject to prevailing economic and competitive conditions and to certain regulatory, competitive, financial, business, and other factors beyond our control.
Our ability to make scheduled payments on or to refinance our debt obligations and to fund planned capital expenditures and expansion efforts depends on our ability to generate cash in the future and our financial condition and operating performance.
We may not be able to retain our executive officers and key personnel or attract additional qualified management in the future. We can make no assurances that future changes in executive management will not have a material adverse effect on our business, financial condition, or results of operations.
We may not be able to retain our executive officers and key personnel or attract additional qualified management in the future, and any such changes in executive management could have a material adverse effect on our business, financial condition, or results of operations. In addition, our industry continues to experience a shortage of workers, which may prove to be systemic.
If these regulations or others are changed in a manner that reduces restrictions on products being manufactured overseas, we would likely face an increase in the number of competitors and increased price competition from overseas manufacturers, who are restricted by current import and export laws from manufacturing products for U.S. defense systems.
If these regulations or others are changed in a manner that reduces restrictions on overseas manufacturing, we would likely face increased competition and price pressure from overseas manufacturers, who are currently restricted by import and export laws.
Although we have taken measures to mitigate our risk to interest rate increases, our swap instruments may not be wholly effective in mitigating this risk or otherwise provide an effective hedge against all interest rate volatility.
Although we have taken measures to mitigate our risk to interest rate increases, our swap instruments may not be wholly effective in mitigating this risk or otherwise provide an effective hedge against all interest rate volatility. See Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk and Interest Rate Risks in this Report for further information.
Moreover, our key suppliers may reduce their output or become insolvent, thereby adversely impacting our ability to manufacture our products. Uncertainty, volatility, and adverse changes in the global economy and financial markets, including those resulting from the conflict between Russia and Ukraine and other global conflicts, could have an adverse impact on our business and operating results.
Uncertainty, volatility, and adverse changes in the global economy and financial markets, including those resulting from the conflict between Russia and Ukraine and other conflicts, could have an adverse impact on our business and operating results.
We may also become subject to additional collective bargaining agreements in the future if more employees or segments of our workforce become unionized, including any of our employees in the United States.
Any of these events could be disruptive to our operations and could result in negative publicity, loss of contracts, and a decrease in revenues. We may also become subject to additional collective bargaining agreements in the future if more employees or segments of our workforce become unionized, including any of our employees in the United States.
Regulatory Risks We are subject to the requirements of the NISPOM for our facility security clearance, which is a prerequisite to our ability to perform on classified contracts for the U.S. government.
Regulatory Risks We are subject to the requirements of the NISPOM for our facility security clearance, which is a prerequisite to our ability to perform on classified contracts for the USG. A facility security clearance is required in order to be awarded and perform on classified contracts for the DoW and certain other agencies of the USG.
As a result, suppliers and equipment manufacturers have extended lead times, limited supplies, and/or increased prices due to capacity constraints and other factors. These have impacted our ability to deliver our products on a timely basis, our inventory levels and cash flow, and could negatively impact our financial results.
As a result, they may have extended lead times, limited supplies, reduced workforces, and/or increased prices due to capacity constraints and other factors, which could negatively impact our delivery times, inventory levels, and cash flow and could negatively impact our financial results.
The transition to the new ERP system will affect numerous systems necessary for our operation. If we fail to correctly implement one or more components of the ERP system, we could experience significant disruption to our operations.
However, there is no 23 assurance that the system upgrade will meet our current or future business needs or that it will operate as designed. The transition to the new ERP will affect numerous systems necessary for our operation. If we fail to correctly implement one or more components of the ERP, we could experience significant disruption to our operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Beyond initial creation, procedures are continually re-assessed, augmented, updated, and tested on an ongoing basis; • The SVP-IT works with the Executive Team on the identification, assessment, verification, and classification of incidents to determine affected stakeholders and appropriate parties for contact ; • The SVP-IT is responsible for launching the Cybersecurity Incident Response Team (CIRT) if necessary, and for notification to the Chief Executive Officer, who in turn will contact the Board of Directors and Government Security Committee in order to validate the response is being addressed appropriately. • The CIRT team, in consultation with outside experts if needed, is responsible for the following: o Initial containment; o Analysis to establish root cause of incidents, identification and evidence collection; o Incident containment by further analyzing additional information and further identifying any additional compromised machines or resources not previously identified; o Implementing solutions designed to solve underlying problems and prevent re-occurrence; o Recovery and restoring normal business functionality; o Review after closure of each incident and conducting a post-mortem analysis to improve prevention and help to make incident response processes more efficient and effective.
Beyond initial creation, procedures are continually reassessed, augmented, updated, and tested on an ongoing basis; • The SVP-IT works with the Executive Team on the identification, assessment, verification, and classification of incidents to determine affected stakeholders and appropriate parties for contact ; • The SVP-IT is responsible for launching the CIRT if necessary, and for notification to the Chief Executive Officer, who in turn will contact the Board of Directors and Government Security Committee in order to validate the response is being addressed appropriately. • The CIRT team, in consultation with outside experts if needed, is responsible for the following: o Initial containment; o Analysis to establish root cause of incidents, identification, and evidence collection; o Incident containment by further analyzing additional information and further identifying any additional compromised machines or resources not previously identified; o Implementing solutions designed to solve underlying problems and prevent recurrence; o Recovery and restoring normal business functionality; o Review after closure of each incident and conducting a post-mortem analysis to improve prevention and help to make incident response processes more efficient and effective.
Cybersecurity risk management and strategy We assess and identify security risk to the organization by: • conducting assessments of risk including likelihood and magnitude from unauthorized access, use, disclosure, disruption, modification, or destruction of information systems and the related information processes, stored, or transmitted; 34 • performing risk assessments and producing security assessment reports that document the results of the assessment for use and review by IT senior leadership, including the Company’s Senior Vice President of Information Technology (SVP-IT); • ensuring security controls are assessed for effectiveness, are implemented correctly, operating as intended, and producing the desired outcome; and • periodically scanning for vulnerabilities and remedying all vulnerabilities in accordance with the associated risk.
If we fail to properly assess and identify cybersecurity risks, we may become increasingly vulnerable to such risks. 24 Cybersecurity risk management and strategy We assess and identify security risk to the organization by: • conducting assessments of risk including likelihood and magnitude from unauthorized access, use, disclosure, disruption, modification, or destruction of information systems and the related information processes, stored, or transmitted; • performing risk assessments and producing security assessment reports that document the results of the assessment for use and review by IT senior leadership, including the Company’s SVP-IT; • ensuring security controls are assessed for effectiveness, are implemented correctly, operating as intended, and producing the desired outcome; and • periodically scanning for vulnerabilities and remedying all vulnerabilities in accordance with the associated risk.
While we continually work to safeguard the information systems we use, and the proprietary, confidential, and personal information residing therein, and mitigate potential risks, there can be no assurance that such actions will be sufficient to prevent cybersecurity incidents or mitigate all potential risks to such systems, networks, and data or those of our third-party providers. 35 Governance We have invested in robust data security and privacy protections.
While we continually work to safeguard the information 25 systems we use, and the proprietary, confidential, and personal information residing therein, and mitigate potential risks, there can be no assurance that such actions will be sufficient to prevent cybersecurity incidents or mitigate all potential risks to such systems, networks, and data or those of our third-party providers.
Further, as we pursue new initiatives that improve our operations and cost structure, we are also expanding and improving our information technologies, resulting in a larger technological presence and increased exposure to cybersecurity risk. If we fail to properly assess and identify cybersecurity risks, we may become increasingly vulnerable to such risks.
Further, as we pursue new initiatives that improve our operations and cost structure, we are also expanding and improving our information technologies, resulting in a larger technological presence and increased exposure to cybersecurity risk.
These reviews included standard cybersecurity-related metrics as well as other detailed reviews of sensitive systems . Our SVP-IT has over 25 years of experience in IT, which include various leadership roles at other large corporations and holds an Executive Master in Cybersecurity degree from Brown University. 36
Our SVP-IT has over 25 years of experience in IT, which include various leadership roles at other large corporations and holds an Executive Master in Cybersecurity degree from Brown University. 26
We follow industry-standard recommendations for data security such as those outlined in the National Institute of Standards and Technology (NIST) Special Publication 800-171 and evolving Cybersecurity Maturity Model Certification (CMMC) frameworks . We have developed cybersecurity policies and procedures, including a data classification system to ensure the protection of critical data.
Governance We have invested in robust data security and privacy protections. We follow industry-standard recommendations for data security such as those outlined in the National Institute of Standards and Technology (NIST) Special Publication 800-171 and evolving Cybersecurity Maturity Model Certification (CMMC) frameworks .
In addition to periodic internal review, we also employ external auditors as needed, and cybersecurity testing firms to review our cybersecurity posture. We maintain a CIRT, whose responsibilities are described above. We conduct periodic tests with this team to maintain readiness and resiliency while regularly reviewing its policies in the interest of protecting data security.
We have developed cybersecurity policies and procedures, including a data classification system to ensure the protection of critical data. In addition to periodic internal review, we also employ external auditors as needed, and cybersecurity testing firms to review our cybersecurity posture. We maintain a CIRT, whose responsibilities are described above.
In addition, our Government Security Committee of the Board of Directors is responsible for reviewing Cybersecurity Posture and overall resilience of the aerospace and defense portion of the network. The Government Security Committee reviews global cybersecurity risk with the SVP-IT at least four times a year.
The regular training of employees, at least annually, on the ever-present threat of cybersecurity helps maintain data security. Our Board of Directors receives an update from our SVP-IT twice per year. In addition, our Government Security Committee of the Board of Directors is responsible for reviewing Cybersecurity Posture and overall resilience of the aerospace and defense portion of the network.
External companies or agencies may be called upon to provide consulting, guidance, assistance, or some other form of support in response to a cybersecurity incident. The regular training of employees, at least annually, on the ever-present threat of cybersecurity helps maintain data security. Our Board of Directors receives an update from our SVP-IT twice per year.
We conduct periodic tests with this team to maintain readiness and resiliency while regularly reviewing its policies in the interest of protecting data security. External companies or agencies may be called upon to provide consulting, guidance, assistance, or some other form of support in response to a cybersecurity incident.
Added
The Government Security Committee reviews global cybersecurity risk with the SVP-IT at least four times a year. These reviews included standard cybersecurity-related metrics as well as other detailed reviews of sensitive systems .

Item 2. Properties

Properties — owned and leased real estate

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(2) In December 2021, we entered into a joint venture agreement with our landlord, O.J.B./1600 University Boulevard, LLC, Count Du Greenmonet, LLC and GFI#2/DII, LLC, to jointly own approximately 100,896 square feet of land and building.
(2) In December 2021, we entered into a joint venture agreement with our landlord, O.J.B./1600 University Boulevard, LLC, Count Du Greenmonet, LLC and GFI#2/DII, LLC, to jointly own approximately 101,000 square feet of land and building.
We have a 50% ownership interest and we account for this joint venture under the equity method of accounting and do not consolidate our interest in the property. (3) Location includes two manufacturing facilities. We maintain our properties in good operating condition.
We have a 50% ownership interest and we account for this joint venture under the equity method of accounting and do not consolidate our interest in the property. (3) Location includes two A&D and one RF&S Components manufacturing facilities. We maintain our properties in good operating condition.
ITEM 2. P ROPERTIES The following table describes our headquarters and our principal manufacturing facilities as of December 30, 2024: U.S.
ITEM 2. P ROPERTIES The following table describes our headquarters and our principal manufacturing facilities as of December 29, 2025: U.S.
We believe that our properties are suitable and adequate for us to operate at present levels, and the productive capacity and extent of utilization of the facilities are appropriate for our existing manufacturing requirements. On November 1, 2023, we announced our selection of Syracuse, New York as the location for a new proposed advanced technology PCB manufacturing facility.
We believe that our properties are suitable and adequate for us to operate at present levels, and the productive capacity and extent of utilization of the facilities are appropriate for our existing manufacturing requirements.
Locations Operating Segment Leased Square Feet Owned Square Feet Total Square Feet Chippewa Falls, WI PCB — 280,086 280,086 Farmingdale, NY PCB — 171,600 171,600 Forest Grove, OR PCB — 212,453 212,453 Huntington, NY PCB 82,440 — 82,440 Littleton, CO PCB 54,590 63,210 117,800 Logan, UT PCB 12,000 118,448 130,448 North Jackson, OH PCB 8,800 85,000 93,800 Salem, NH PCB 43,700 — 43,700 San Diego, CA PCB 43,336 — 43,336 San Jose, CA PCB 42,434 — 42,434 Santa Ana, CA (1) Headquarters 14,472 — 14,472 Santa Ana, CA PCB 13,439 82,550 95,989 Stafford, CT PCB — 126,924 126,924 Stafford Springs, CT PCB — 115,579 115,579 Sterling, VA (2) PCB 100,896 — 100,896 Syracuse, NY (3) PCB and RF&S Components 37,639 162,587 200,226 Total 453,746 1,418,437 1,872,183 Foreign Locations Operating Segment Leased Square Feet Owned Square Feet Total Square Feet Canada Toronto PCB 15,500 99,960 115,460 Malaysia Penang PCB 827,000 — 827,000 China Dongguan PCB — 1,069,129 1,069,129 Guangzhou PCB — 1,872,800 1,872,800 Hong Kong (1) Asia Headquarters — 24,640 24,640 Huiyang PCB — 435,485 435,485 Suzhou RF&S Components 68,030 — 68,030 Zhongshan PCB — 1,132,760 1,132,760 Total 910,530 4,634,774 5,545,304 (1) Location of our headquarters and not a manufacturing facility.
Locations Operating Segment Leased Square Feet Owned Square Feet Total Square Feet Chippewa Falls, WI A&D — 280,000 280,000 Eau Claire, WI Commercial — 715,000 715,000 Farmingdale, NY A&D — 172,000 172,000 Forest Grove, OR A&D — 212,000 212,000 Littleton, CO A&D 27,000 63,000 90,000 Logan, UT Commercial 12,000 118,000 130,000 North Jackson, OH A&D — 85,000 85,000 Salem, NH A&D 44,000 — 44,000 San Diego, CA A&D 43,000 — 43,000 San Jose, CA Commercial 42,000 — 42,000 Santa Ana, CA (1) Headquarters 14,000 — 14,000 Santa Ana, CA A&D 18,000 83,000 101,000 Stafford, CT A&D — 130,000 130,000 Stafford Springs, CT A&D — 116,000 116,000 Sterling, VA (2) A&D 101,000 — 101,000 Syracuse, NY (3) A&D and RF&S Components 38,000 378,000 416,000 Total 339,000 2,352,000 2,691,000 Foreign Locations Operating Segment Leased Square Feet Owned Square Feet Total Square Feet Canada Toronto Commercial 16,000 139,000 155,000 Malaysia Penang Commercial 876,000 — 876,000 China Dongguan Commercial — 1,292,000 1,292,000 Guangzhou Commercial — 2,251,000 2,251,000 Hong Kong (1) Asia Headquarters — 25,000 25,000 Huiyang Commercial — 518,000 518,000 Suzhou RF&S Components 68,000 — 68,000 Zhongshan Commercial 192,000 1,298,000 1,490,000 Total 1,152,000 5,523,000 6,675,000 (1) Location of our headquarters and not a manufacturing facility.
Removed
We expect that the proposed facility will bring advanced technology capability for our domestic high-volume production of ultra-high-density interconnect (HDI) PCBs in support of national security requirements.
Removed
We believe the planned investment aligns with New York State’s continuing focus on the region as a premier technology hub for U.S. electronics and the recent selection of Buffalo-Rochester-Syracuse (BRS) for the Federal Tech Hub designation. The project reflects our support for cultivating a stronger microelectronics ecosystem in New York and across the U.S. Aerospace and Defense industrial base.
Removed
We are continuing construction for the new building on the 24-acre property adjacent to our existing facility in Syracuse for the campus expansion and the site for the new facility, and we expect to commence initial low rate production in 2026.
Removed
Phase one of the proposed project, including capital for campus-wide improvements is estimated to be $100.0 million to $130.0 million.
Removed
We expect to receive support in the form of grants, awards, and tax credits from both federal and New York state sources of approximately 37 $52.0 million in the aggregate (subject to certain requirements and contingencies), which would offset the initial capital investment and lower operating expenses.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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In the event of an adverse outcome, the ultimate potential loss could have a material adverse effect on our financial condition, results of operations, or cash flows in a particular period. ITEM 4. MINE SAF ETY DISCLOSURES Not applicable. 38 PART II
In the event of an adverse outcome, the ultimate potential loss could have a material adverse effect on our financial condition, results of operations, or cash flows in a particular period. ITEM 4. MINE SAF ETY DISCLOSURES Not applicable. 27 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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The graph assumes $100 was invested in our common stock on December 30, 2019, and an investment in Nasdaq Composite Index and the Dow Jones U.S. Electrical Components & Equipment Index. The stock performance shown on the graph below represents historical stock performance and is not necessarily indicative of future stock performance.
The graph assumes $100 was invested in our common stock on December 28, 2020, and an investment in Nasdaq Composite Index and the Dow Jones U.S. Electrical Components & Equipment Index. The stock performance shown on the graph below represents historical stock performance and is not necessarily indicative of future stock performance.
The performance graph above will not be deemed incorporated by reference into any filing of our company under the Securities Act of 1933, as amended, or the Exchange Act. 39 Dividends We have never declared or paid cash dividends on our common stock.
The performance graph above will not be deemed incorporated by reference into any filing of our company under the Exchange Act. 28 Dividends We have never declared or paid cash dividends on our common stock.
STOCK PRICE PERFORMANCE GRAPH The performance graph below compares, for the period from December 30, 2019 to December 30, 2024, the cumulative total stockholder return on our common stock against the cumulative total return of the Nasdaq Composite Index and the Dow Jones U.S. Electrical Components and Equipment Index.
STOCK PRICE PERFORMANCE GRAPH The performance graph below compares, for the period from December 28, 2020 to December 29, 2025, the cumulative total stockholder return on our common stock against the cumulative total return of the Nasdaq Composite Index and the Dow Jones U.S. Electrical Components and Equipment Index.
As of February 14, 2025, there were approximately 236 holders of record of our common stock, although there are a significantly larger number of beneficial owners of our common stock.
As of February 11, 2026, there were approximately 221 holders of record of our common stock, although there are a significantly larger number of beneficial owners of our common stock.
Electrical Components & Equipment 100.00 120.75 151.36 124.87 159.56 213.20 The performance graph above shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), or otherwise subject to the liability of that section.
Electrical Components & Equipment 100.00 125.35 103.42 132.15 176.57 236.57 The performance graph above shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section.
Issuer Purchases of Equity Securities On May 3, 2023, our Board of Directors authorized a share repurchase program, under which we may repurchase up to $100.0 million of our outstanding shares of common stock through May 3, 2025. We did not repurchase any shares of our common stock during the quarter ended December 30, 2024. ITEM 6 .
Issuer Purchases of Equity Securities On May 8, 2025, our Board of Directors authorized the 2025 Repurchase Program, under which we may repurchase up to $100.0 million in value of our common stock from time to time through May 7, 2027. Our previous two-year repurchase program expired on May 3, 2025.
Electrical Components & Equipment Index * $100 invested on December 30, 2019 in stock or index, including reinvestment of dividends. 12/30/2019 12/28/2020 1/3/2022 1/2/2023 1/1/2024 12/30/2024 TTM Technologies, Inc. $ 100.00 $ 92.41 $ 101.75 $ 101.34 $ 106.25 $ 165.99 Nasdaq Composite 100.00 144.92 177.06 119.45 172.77 223.87 Dow Jones U.S.
Electrical Components & Equipment Index * $100 invested on December 28, 2020 in stock or index, including reinvestment of dividends. 12/28/2020 1/3/2022 1/2/2023 1/1/2024 12/30/2024 12/29/2025 TTM Technologies, Inc. $ 100.00 $ 110.11 $ 109.67 $ 114.98 $ 179.64 $ 517.89 Nasdaq Composite 100.00 122.18 82.43 119.22 154.48 187.14 Dow Jones U.S.
Added
We did not repurchase any shares of our common stock during the quarter ended December 29, 2025. ITEM 6 . RESERVED Not applicable. 29

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

64 edited+45 added−57 removed21 unchanged
Net Sales Total net sales increased $210.2 million, or 9.4%, to $2,442.8 million for the year ended December 30, 2024 from $2,232.5 million for the year ended January 1, 2024.
Total net sales increased $210.2 million, or 9.4%, to $2,442.8 million for the year ended December 30, 2024 from $2,232.5 million for the year ended January 1, 2024.
Total Other Expense, Net Total other expense, net decreased $9.9 million to $32.1 million for the year ended December 30, 2024 from $42.0 million for the year ended January 1, 2024.
Total other expense, net decreased $9.9 million to $32.1 million for the year ended December 30, 2024 from $42.0 million for the year ended January 1, 2024.
A critical accounting policy is defined as one that is both material to the presentation of our consolidated financial statements and requires us to make judgments that could have a material effect on our financial condition or results of operations. These policies 42 require us to make assumptions about matters that are highly uncertain at the time of the estimate.
A critical accounting policy is defined as one that is both material to the presentation of our consolidated financial statements and requires us to make judgments that could have a material effect on our financial condition or results of operations. These policies require us to make assumptions about matters that are highly uncertain at the time of the estimate.
Critical accounting estimates refers to those estimates made in accordance with U.S. GAAP that have had or are reasonably likely to have a material impact on the amounts reported in the consolidated financial statements and the related notes due to the significant level of uncertainty involved in developing the estimate.
Critical accounting estimates refers 31 to those estimates made in accordance with U.S. GAAP that have had or are reasonably likely to have a material impact on the amounts reported in the consolidated financial statements and the related notes due to the significant level of uncertainty involved in developing the estimate.
We also manufacture certain components, assemblies, subsystems, and completed systems which service our RF and Specialty Components (RF&S Components) customers and certain aerospace and defense customers. We recognize revenue at a point in time upon transfer of control of the products to our customer.
We also manufacture certain components, assemblies, subsystems, and completed systems which service our RF&S Components customers and certain aerospace and defense customers. We recognize revenue at a point in time upon transfer of control of the products to our customer.
Net cash used in financing activities was $36.8 million for the year ended December 30, 2024, reflecting the use of $34.5 million for repurchases of our common stock, $9.6 million for the repayment of long-term debt borrowings, and $1.2 million for payment of debt issuance costs, partially offset by $8.4 million of proceeds from long-term debt borrowings primarily related to the refinancing of our Term Loan Facility due 2030 (Term Loan Facility).
Net cash used in financing activities was $36.8 million for the year ended December 30, 2024, reflecting the use of $34.5 million for repurchases of our common stock, $9.6 million for the repayment of long-term debt borrowings, and $1.2 million for payment of debt issuance costs, partially offset by $8.4 million of proceeds from long-term debt borrowings primarily related to the refinancing of our Term Loan Facility.
The primary driver of this increase was demand growth for generative artificial intelligence (AI) applications in our data center computing end market and strong demand and improved operational execution in our aerospace and defense end market, partially offset by demand weakness due to customers' inventory correction in our automotive, medical, industrial, and instrumentation, and networking end markets.
The primary driver of this increase was demand growth for generative AI applications in our data center computing end market and strong demand and improved operational execution in our aerospace and defense end market, partially offset by demand weakness due to customers' inventory correction in our automotive, medical, industrial, and instrumentation, and networking end markets.
Shipping and handling fees and related freight costs and supplies associated with shipping products are also included as a component of cost of goods sold. Many factors affect our gross margin, including capacity utilization, product mix, production volume, supply chain costs, and yield.
Shipping and handling fees and related freight costs and supplies associated with shipping products are also included as a component of cost of goods sold. Many factors affect our gross margin, including product mix, production volume, supply chain costs, and yield.
Based on our current level of operations, we believe that cash generated from operations, cash on hand, and cash from the issuance of term and revolving debt will be adequate to meet our currently anticipated capital expenditure, debt service, and working capital needs for the next twelve months.
Based on our current level of operations, we believe that cash generated from operations, cash on hand, and cash from the issuance of term and revolving debt will be adequate to meet our currently anticipated capital expenditure, debt service, and working capital needs for the next 12 months.
Customers have continuous control of the work in progress and finished goods throughout the PCB and engineered systems manufacturing process, as these are built to customer specifications with no alternative use, and there is an enforceable right to payment for work performed to date.
Revenue Recognition For PCBs and engineered systems, customers have continuous control of the work in progress and finished goods throughout the PCB and engineered systems manufacturing process, as these are built to customer specifications with no alternative use, and there is an enforceable right to payment for work performed to date.
Fair value is determined through various valuation techniques, including cost-based, market, and income approaches as considered necessary, which involve judgments related to future cash flows and the application of the appropriate valuation model. 44 RESULTS OF OPERATIONS We operate on a 52 or 53 week fiscal calendar with the fourth quarter ending on the Monday nearest December 31.
Fair value is determined through various valuation techniques, including cost-based, market, and income approaches as considered necessary, which involve judgments related to future cash flows and the application of the appropriate valuation model. CONSOLIDATED OPERATING RESULTS We operate on a 52 or 53 week fiscal calendar with the fourth quarter ending on the Monday nearest December 31.
An increase or decrease of 200 basis points in gross margin estimates would have increased or decreased our contract assets by $3.7 million and $2.3 million, respectively, and decreased or increased our contract liabilities by $7.2 million and $5.6 million, respectively.
An increase or decrease of 200 basis points in gross margin estimates would have increased or decreased our contract assets by $3.7 million and $2.9 million, respectively, and decreased or increased our contract liabilities by $6.4 million and $5.8 million, respectively.
If the economy or business environment falter and we are unable to achieve our assumed revenue growth rates or profit margin percentages, our projections used would need to be re-measured, which could impact the carrying value of our goodwill in one or more of our reporting units. We also assess definite-lived intangibles for potential impairment given similar impairment indicators.
If the economy or business environment falters and we are unable to achieve our assumed revenue growth rates or profit margin percentages, our projections used would need to be remeasured, which could impact the carrying value of our goodwill in one or more of our reporting units. We also assess definite-lived intangibles for potential impairment given similar impairment indicators.
We discuss such risks, uncertainties, and other factors throughout this Annual Report on Form 10-K (Report) and specifically under Item 1A, Risk Factors of Part I of this Report. In addition, the following discussion should be read in connection with the information presented in our consolidated financial statements and the related notes to our consolidated financial statements.
We discuss such risks, uncertainties, and other factors throughout this Report and specifically under Item 1A, Risk Factors of Part I of this Report. In addition, the following discussion should be read in connection with the information presented in our consolidated financial statements and the related notes to our consolidated financial statements.
Recently Issued Accounting Standards For a description of recently adopted and issued accounting standards, including the respective dates of adoption and expected effects on our results of operations and financial condition, see Part II, Item 8, Note 1, Nature of Operations and Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements. 49
Recently Issued Accounting Standards For a description of recently adopted and issued accounting standards, including the respective dates of adoption and expected effects on our results of operations and financial condition, see Part II, Item 8, Note 1, Nature of Operations and Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements included in this Report. 38
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This financial review presents our operating results for each of our three most recent fiscal years and our financial condition as of December 30, 2024.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This financial review presents our operating results for each of our three most recent fiscal years and our financial condition as of December 29, 2025.
A summary of our long-term debt obligations as of December 30, 2024 is included in Part II, Item 8, Note 8, Long‑term Debt and Letters of Credit , of the Notes to Consolidated Financial Statements included in this Report.
A summary of our long-term debt obligations as of December 29, 2025 is included in Part II, Item 8, Note 7, Long‑term Debt and Letters of Credit , of the Notes to Consolidated Financial Statements included in this Report.
ABL) and Asia ABL (collectively, the ABL Revolving Loans), we are also subject to various financial covenants, including leverage and fixed charge coverage ratios. As of December 30, 2024, we were in compliance with the covenants under the Senior Notes due 2029, Term Loan Facility, and ABL Revolving Loans.
Under the ABL Revolving Loans, we are also subject to various financial covenants, including leverage and fixed charge coverage ratios. As of December 29, 2025, we were in compliance with the covenants under the Senior Notes due 2029, Term Loan Facility, and ABL Revolving Loans.
Research and development expenses consist primarily of salaries and labor-related benefits paid to our research and development staff, as well as material costs. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our consolidated financial statements included in this Report have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Research and development expenses consist primarily of salaries and labor-related benefits paid to our research and development staff, as well as material costs. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our consolidated financial statements included in this Report have been prepared in accordance with U.S. GAAP.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
We serve a diversified customer base consisting of approximately 1,400 customers in various markets throughout the world, including aerospace and defense, data center computing, automotive, medical, industrial and instrumentation, and networking. Our customers include original equipment manufacturers (OEMs), electronic manufacturing services (EMS) providers, original design manufacturers (ODMs), distributors, and government agencies (both domestic and allied foreign governments).
We serve a diversified customer base consisting of approximately 1,300 customers in various markets throughout the world, including aerospace and defense, data center computing, automotive, medical, industrial, and instrumentation, and networking. Our customers include OEMs, EMS providers, ODMs, distributors, and government agencies (both domestic and allied foreign governments).
COMPANY OVERVIEW We are a leading global manufacturer of technology solutions, including mission systems, radio frequency (RF) components, RF microwave/microelectronic assemblies, and quick-turn and technologically advanced printed circuit boards (PCB). We focus on providing time-to-market and volume production of advanced technology products and offer a one-stop design, engineering, and manufacturing solution to our customers.
COMPANY OVERVIEW We are a leading global manufacturer of technology products, including mission systems, RF components, RF microwave/microelectronic assemblies, and technologically advanced interconnect products, including PCBs and substrates. We focus on providing time-to-market and volume production of advanced technology products and offer a one-stop design, engineering, and manufacturing solution to our customers.
We derive revenues primarily from the sale of PCBs, engineered systems using customer-supplied engineering and design plans as well as our long-term contracts related to the design and manufacture of highly sophisticated intelligence, surveillance, and communications solutions, and RF and microwave/microelectronics components, assemblies, and subsystems.
(2) Sales to EMS companies are classified by the end markets of their OEM customers. We derive revenues primarily from the sale of PCBs, engineered systems using customer-supplied engineering and design plans as well as our long-term contracts related to the design and manufacture of highly sophisticated intelligence, surveillance, and communications solutions, and RF and microwave/microelectronics components, assemblies, and subsystems.
For revenue recorded on an over time basis, we apply a gross margin estimate to inventory in process of being manufactured for customers to determine how much of a contract asset or contract liability should be recorded at period end.
For revenue recorded on an over time basis, we apply a gross margin estimate to inventory in process of being manufactured for customers to determine how much of a contract asset or contract liability should be recorded at period end. We use historical information to estimate the gross margin associated with performance obligations that are satisfied over time.
Our policy regarding non-standard or customized items dictates that such items are only ordered specifically for customers who have contractually assumed liability for the inventory, although exceptions are made to this policy in certain situations.
Orders for standard, or catalog, items can typically be canceled with little or no financial penalty. Our policy regarding non-standard or customized items dictates that such items are only ordered specifically for customers who have contractually assumed liability for the inventory, although exceptions are made to this policy in certain situations.
As of December 30, 2024, we had cash and cash equivalents of approximately $503.9 million, of which approximately $207.9 million was held by our foreign subsidiaries, primarily in China, and $195.6 million of available borrowing capacity under our revolving credit facilities.
As of December 29, 2025, we had cash and cash equivalents of approximately $501.2 million, of which approximately $191.9 million was held by our foreign subsidiaries, primarily in China, and $195.8 million of available borrowing capacity under our revolving credit facilities.
Additional information regarding our indebtedness, including information about the credit available under our debt facilities, interest rates, and other key terms of our outstanding indebtedness, is included in Part II, Item 8, Note 8, Long‑term Debt and Letters of Credit , of the Notes to Consolidated Financial Statements included in this Report. 48 Supplier Finance Program Obligations We have agreements with financial institutions to facilitate payments to certain suppliers.
Additional information regarding our indebtedness, including information about the credit available under our debt facilities, interest rates, and other key terms of our outstanding indebtedness, is included in Part II, Item 8, Note 7, Long‑term Debt and Letters of Credit , of the Notes to Consolidated Financial Statements included in this Report.
Our aggregate interest on debt obligations as of December 30, 2024 amounted to $226.0 million, which are expected to be settled as follows: $47.6 million within 1 year, $94.9 million within 1-3 years, $74.7 million within 4-5 years, and $8.8 million after 5 years. For debt obligations based on variable rates, interest rates used are as of December 30, 2024.
Our aggregate interest on debt obligations as of December 29, 2025 amounted to $167.9 million, which are expected to be settled as follows: $44.7 million within 1 year, $85.0 million within 1-3 years, and $38.2 million within 4-5 years. For debt obligations based on variable rates, interest rates used are as of December 29, 2025.
RECENT DEVELOPMENTS In the third quarter of 2024, we commenced construction of our new advanced technology PCB manufacturing facility in Syracuse, New York. We expect that our new facility will bring advanced technology capability for our domestic high-volume production of ultra-high-density interconnect (HDI) PCBs in support of national security requirements.
We previously announced we are in the process of constructing a new advanced technology PCB manufacturing facility in Syracuse, New York. We expect that our new facility will bring advanced technology capability for our domestic high-volume production of ultra-HDI PCBs in support of national security requirements.
Cash flow provided by operating activities during the year ended December 30, 2024 was $236.9 million as compared to $187.3 million in the same period in 2023. The increase in cash flow was primarily due to the $75.0 million increase in net income.
Cash flow provided by operating activities during the year ended December 29, 2025 was $291.9 million as compared to $236.9 million in the same period in 2024. The increase in cash flow was primarily due to the $121.1 million increase in net income, partially offset by an increase in working capital.
Based on the review of gross margins, we update our estimate to the model as necessary. If our estimates of gross margins are inaccurate, we may recognize too much or too little revenue in a period. While experience has shown that trends in gross margins are not volatile, changes in pricing or cost efficiencies could create significant fluctuations.
We reevaluate our estimate of gross margins on a quarterly basis. Based on the review of gross margins, we update our estimate to the model as necessary. If our estimates of gross margins are inaccurate, we may recognize too much or too little revenue in a period.
In the fourth quarter of 2024, we performed our annual goodwill impairment test qualitatively for the PCB reporting unit and concluded that it was more likely than not that there was no impairment to goodwill. In the fourth quarter of 2024, we performed our annual goodwill impairment test quantitatively for the RF&S Components reporting unit.
In the fourth quarter of 2025, we performed our annual goodwill impairment test qualitatively for the A&D, Commercial, and RF&S Components reporting units and concluded that it was more likely than not that there was no impairment to goodwill. 32 Management will continue to monitor the reporting units for changes in the business environment that could impact recoverability.
A summary of our lease obligations as of December 30, 2024 is included in Part II, Item 8, Note 4, Leases , of the Notes to Consolidated Financial Statements included in this Report.
A summary of our lease obligations as of December 29, 2025 is included in Part II, Item 8, Note 13, Leases , of the Notes to Consolidated Financial Statements included in this Report. Seasonality We do not consider any material portion of our business to be seasonal.
Net sales for the PCB reportable segment increased $211.6 million, or 9.6%, to $2,405.6 million for the year ended December 30, 2024 from $2,194.0 million for the year ended January 1, 2024.
Segment sales for the Commercial reportable segment increased $111.0 million, or 9.5%, to $1,275.7 million for the year ended December 30, 2024, from $1,164.7 million for the year ended January 1, 2024.
Fiscal years 2024, 2023, and 2022 consisted of 52 weeks ended on December 30, 2024, January 1, 2024, and January 2, 2023, respectively.
Fiscal years 2025, 2024, and 2023 consisted of 52 weeks ended on December 29, 2025, December 30, 2024, and January 1, 2024, respectively. All references to years relate to fiscal years unless otherwise noted.
Income Taxes Income tax expense increased $8.6 million to $27.7 million for the year ended December 30, 2024 from $19.0 million for the year ended January 1, 2024, primarily due to an increase in pre-tax book income.
Income tax expense increased $8.6 million to $27.7 million for the year ended December 30, 2024 from $19.0 million for the year ended January 1, 2024, primarily due to an increase in income before income taxes. On July 4, 2025, the OBBBA was enacted, introducing amendments to U.S. tax laws with various effective dates from 2025 to 2027.
We also sold our Shanghai Backplane Assembly entity in the first quarter of 2023, which had the effect of reducing net sales in 2024 by $8.4 million. Net sales for the RF&S Components reportable segment decreased $1.4 million, or 3.6%, to $37.1 million for the year ended December 30, 2024 from $38.5 million for the year ended January 1, 2024.
We also sold our Shanghai Backplane Assembly entity in the first quarter of 2023, which had the effect of reducing Commercial reportable segment net sales in 2024 by $8.4 million.
This decrease was primarily due to the weakening RMB resulting in a $1.2 million foreign exchange gain during the year ended December 30, 2024, as compared to a $3.9 million foreign exchange loss during the year ended January 1, 2024. We utilize the RMB at our China facilities for employee-related and other costs of running our operations in China.
This decrease was primarily due to the weakening RMB resulting in a $1.2 million foreign exchange gain during the year ended December 30, 2024, as compared to a $3.9 million foreign exchange loss during the year ended January 1, 2024. In addition, there was a $3.8 million increase in interest income and $0.6 million decrease in interest expense.
These obligations impact our liquidity and capital resource needs. Our estimated future obligations consist of long-term debt obligations, interest on debt obligations, derivative liabilities, purchase obligations, and leases.
Contractual Obligations and Commitments As part of our ongoing operations, we enter into contractual arrangements that obligate us to make future cash payments. These obligations impact our liquidity and capital resource needs. Our estimated future obligations consist of long-term debt obligations, interest on debt obligations, derivative liabilities, purchase obligations, and leases.
As of December 30, 2024, $0.7 million of our derivative liabilities are expected to be settled within one year. We also have outstanding firm purchase orders with certain suppliers for the purchase of material and inventory. Orders for standard, or catalog, items can typically be canceled with little or no financial penalty.
As of December 29, 2025, an immaterial amount of our derivative liabilities is expected to be settled within one year and $0.4 million of our derivative liabilities are expected to be settled within 1-3 years. We also have outstanding firm purchase orders with certain suppliers for the purchase of material and inventory.
We determined the fair value of the reporting unit by using both a DCF and a market approach. Under the market approach, we used revenue and earnings multiples based on comparable industry multiples to estimate the fair value of the reporting unit.
Under the market approach, we used revenue and earnings multiples based on comparable industry multiples to estimate the fair value of the reporting unit. Under the DCF approach, we estimated the future cash flows, as well as selected a risk-adjusted discount rate to measure the present value of the anticipated cash flows.
The increase in general and administrative expenses was primarily due to increases in consulting and other professional services expenses, labor costs, stock-based compensation, bad debt, incentive compensation, and the write down of our Hong Kong building of $6.1 million, partially offset by gains on the sale of assets primarily related to the sale of two buildings vacated with the closure of our Anaheim and Santa Clara plants of $14.4 million.
In addition, $14.4 million of gains on the sale of assets primarily related to the sale of two buildings vacated with the closure of our Anaheim and Santa Clara plants were partially offset by the write down of our Hong Kong building of $6.1 million that occurred during the year ended December 30, 2024.
The percentage of our net sales attributable to each of the principal end markets we served was as follows: For the Year Ended December 30, 2024 January 1, 2024 January 2, 2023 End Markets (1) : Aerospace and Defense 46 % 45 % 35 % Automotive 13 16 17 Data Center Computing 21 14 15 Medical/Industrial/Instrumentation 14 17 20 Networking 6 8 13 Total 100 % 100 % 100 % (1) Sales to EMS companies are classified by the end markets of their OEM customers.
The percentage of our net sales attributable to each of the principal end markets we served was as follows: For the Year Ended December 29, 2025 (1) December 30, 2024 (1) January 1, 2024 (1) End Markets (2) : Aerospace and Defense 44 % 46 % 46 % Automotive 10 13 16 Data Center Computing 24 20 14 Medical/Industrial/Instrumentation 14 14 16 Networking 8 7 8 Total 100 % 100 % 100 % (1) The end market revenue for the years ended December 30, 2024 and January 1, 2024 has been recast to reflect certain adjustments to allocations resulting from the segment reorganization that occurred during the quarter ended June 30, 2025.
As of November 1, 2024, we completed a quantitative goodwill impairment analysis related to our RF&S Components reporting unit by comparing the fair value of the reporting unit with its carrying amount. In making this assessment, we rely on a number of factors, including expected future operating results, business plans, economic projections, anticipated future cash flows, and business trends.
In making this assessment, we rely on a number of factors, including expected future operating results, business plans, economic projections, anticipated future cash flows, and business trends. We determined the fair value of the reporting units by using both a DCF and a market approach.
For details about our offset agreements, see Part II, Item 8, Note 14, Commitments and Contingencies , of the Notes to Consolidated Financial Statements included in this Report.
For additional discussion of the application of our significant accounting policies, see Part II, Item 8, Note 1, Nature of Operations and Summary of Significant Accounting Policies , of the Notes to Consolidated Financial Statements in this Report.
Net cash used in investing activities was $92.0 million for the year ended January 1, 2024, primarily reflecting the use of $160.2 million for purchases of property, plant, and equipment and other assets, partially offset by the receipt of $61.8 million of proceeds from the sale of property associated with our Shanghai E-MS subsidiary and $6.0 million of proceeds from the sale of our Shanghai Backplane Assembly subsidiary, net of cash disposed.
Net cash used in investing activities was $273.9 million for the year ended December 29, 2025, primarily reflecting the use of $292.6 million for purchases of property, plant, and equipment and other assets, partially offset by the receipt of $17.8 million of proceeds from capital-related government incentives.
This increase was primarily due to higher sales volume, particularly in the data center computing and aerospace and defense end markets, and improved operational execution, partially offset by declines in the automotive, medical, industrial, and instrumentation, and networking end markets, higher employee costs, and continued ramp up costs included in cost of goods sold in connection with our fabrication plant in Penang, Malaysia.
These increases were primarily due to higher sales volume and improved operational execution, partially offset by higher employee costs and continued ramp-up costs in connection with our fabrication plant in Penang, Malaysia.
Net cash used in financing activities during the year ended January 1, 2024 was $47.7 million, reflecting repayment of long-term debt borrowings of $291.6 million, repurchases of common stock of $24.4 million, refund of customer deposits of $7.5 million, payment of debt issuance costs of $5.5 million and payment of original issue discount of $3.5 million, partially offset by the receipt of proceeds of $234.8 million from long-term debt borrowing and proceeds of $50.0 million from borrowings under our revolving credit facilities.
Net cash used in financing activities was $20.9 million for the year ended December 29, 2025, reflecting the use of $17.9 million for repurchases of our common stock and $3.8 million for the repayment of long-term debt borrowings, partially offset by the receipt of $1.5 million of customer deposits.
Pursuant to the terms of the Senior Notes due 2029 and Term Loan Facility, we are subject to certain affirmative and negative covenants, including limitations on indebtedness, corporate transactions, investments, dispositions, and restricted payments. Under the U.S. Asset-Based Lending Credit Agreement (U.S.
Long-term Debt and Letters of Credit As of December 29, 2025, we had $916.2 million of outstanding debt, net of discount and debt issuance costs, composed of $497.4 million of Senior Notes due 2029, $336.8 million under the Term Loan Facility, $80.0 million under the Asia ABL, and $2.0 million of other loans. 37 Pursuant to the terms of the Senior Notes due 2029 and Term Loan Facility, we are subject to certain affirmative and negative covenants, including limitations on indebtedness, corporate transactions, investments, dispositions, and restricted payments.
Liabilities associated with these agreements are recorded in accounts payable on the consolidated balance sheets and amounted to $17.2 million and $18.8 million as of December 30, 2024 and January 1, 2024, respectively. Contractual Obligations and Commitments As part of our ongoing operations, we enter into contractual arrangements that obligate us to make future cash payments.
Supplier Finance Program Obligations We have agreements with financial institutions to facilitate payments to certain suppliers. Liabilities associated with these agreements are recorded in accounts payable on the consolidated balance sheets and amounted to $12.5 million and $17.2 million as of December 29, 2025 and December 30, 2024, respectively.
Research and Development Expenses Research and development expenses increased $4.6 million to $31.8 million, or 1.3% of net sales, for the year ended December 30, 2024 from $27.3 million, or 1.2% of net sales, for the year ended January 1, 2024.
Segment sales for the RF&S Components reportable segment decreased $1.3 million, or 3.4%, to $37.3 million for the year ended December 30, 2024, from $38.6 million for the year ended January 1, 2024.
Gross margin for the RF&S Components reportable segment decreased to 48.9% for the year ended December 30, 2024, from 54.7% for the year ended January 1, 2024, primarily due to lower sales. Overall gross margin increased slightly to 18.5% for the year ended January 1, 2024 from 18.4% for the year ended January 2, 2023.
Segment operating income for the RF&S Components reportable segment decreased $2.3 million to $8.7 million for the year ended December 30, 2024, from $11.0 million for the year ended January 1, 2024. Segment operating margin rate for the RF&S Components reportable segment decreased to 23.2% for the December 30, 2024, from 28.4% for the year ended January 1, 2024.
As of December 30, 2024, the remaining amount in value available to be repurchased under the 2023 Repurchase Program was approximately $41.1 million.
As of December 29, 2025, we have not repurchased any shares of our common stock under the 2025 Repurchase Program, and the remaining amount in value available to be repurchased thereunder was $100.0 million.
We believe the following critical accounting policies and estimates reflect the more significant judgments and estimates used by us in preparing our consolidated financial statements: Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services.
We believe the following critical accounting policies and estimates reflect the more significant judgments and estimates used by us in preparing our consolidated financial statements.
We estimated cash flows for the reporting unit over a discrete period and a terminal period (considering expected long-term growth rates and trends).
When determining future cash flow estimates, we considered historical results adjusted to reflect current and anticipated future operating conditions. We estimated cash flows for the reporting unit over a discrete period and a terminal period (considering expected long-term growth rates and trends). We reallocated PCB goodwill to the A&D and Commercial reporting units based on their estimated relative fair values.
The increase in overall gross margin was due to the increase in gross margin for the PCB reportable segment to 20.6% for the year ended December 30, 2024, from 19.3% for the year ended January 1, 2024.
Gross profit increased $64.1 million to $477.4 million for the year ended December 30, 2024, from $413.3 million for the year ended January 1, 2024. Gross margin rate increased to 19.5% for the year ended December 30, 2024, from 18.5% for the year ended January 1, 2024.
Share Repurchases On May 3, 2023, our Board of Directors authorized a share repurchase program (2023 Repurchase Program) allowing us to repurchase up to $100.0 million of our common stock from time to time through May 3, 2025. During 2024, we repurchased approximately 2.0 million shares of our common stock for a total cost of $34.5 million (including commissions).
During the year ended December 29, 2025, under our previous two-year repurchase program that expired on May 3, 2025, we repurchased approximately 0.7 million shares of our common stock for a total cost of $17.9 million (including commissions).
Impairment of Goodwill For the years ended December 30, 2024 and January 1, 2024, we recorded goodwill impairment charges of $32.6 million and $44.1 million, respectively. See Part II, Item 8, Note 6, Goodwill , of the Notes to Consolidated Financial Statements included in this Report for further information.
In connection with the reallocation of goodwill, we performed a quantitative goodwill impairment assessment for these segments and concluded no impairment indicators existed as of June 30, 2025. See Part II, Item 8, Note 4, Segment Information , and Note 6, Goodwill and Definite-lived Intangibles , of the Notes to Consolidated Financial Statements in this Report for further information.
Net sales for the RF&S Components reportable segment decreased $18.6 million, or 32.5%, to $38.5 million for the year ended January 1, 2024 from $57.1 million for the year ended January 2, 2023. The decrease in RF&S Components net sales was primarily due to lower demand in our networking end market.
The primary driver of this decrease was lower demand in our networking end market. 36 Segment Operating Income and Margin Rate Segment operating income for the RF&S Components reportable segment increased $2.6 million to $11.3 million for the year ended December 29, 2025, from $8.7 million for the year ended December 30, 2024.
Selling and Marketing Expenses Selling and marketing expenses increased $3.1 million to $80.0 million for the year ended December 30, 2024 from $76.9 million for the year ended January 1, 2024.
Segment operating income for the A&D reportable segment increased $46.8 million to $141.8 million for the year ended December 30, 2024, from $95.0 million for the year ended January 1, 2024. Segment operating margin rate for the A&D reportable segment increased to 12.4% for the year ended December 30, 2024, from 9.1% for the year ended January 1, 2024.
General and Administrative Expenses General and administrative expenses increased $20.5 million to $170.1 million, or 7.0% of net sales, for the year ended December 30, 2024 from $149.6 million, or 6.7% of net sales, for the year ended January 1, 2024.
Segment sales for the A&D reportable segment increased $94.0 million, or 9.0%, to $1,140.0 million for the year ended December 30, 2024, from $1,046.0 million for the year ended January 1, 2024. The primary driver of this increase was strong demand in our radar and missile systems.
As a result, we recognize revenue progressively over time based on the extent of progress towards completion of the performance obligation. Revenue recognized is based on a cost method as it best depicts the transfer of control to the customer which takes place as we incur costs. Revenues are recorded proportionally as costs are incurred.
As a result, we recognize revenue progressively over time based on the extent of progress towards completion of the performance obligation. See Part II, Item 8, Note 2, Revenues , of the Notes to Consolidated Financial Statements in this Report for further information.
Our effective tax rate is primarily impacted by tax rates in China and Hong Kong, the U.S. federal income tax rate, apportioned state income tax rates, the generation of credits and deductions available to us, as well as changes in the valuation allowance, certain non-deductible items, global intangible low taxed income, and the establishment of a deferred tax liability related to unremitted foreign earnings. 47 Liquidity and Capital Resources Our principal sources of liquidity have been cash provided by operations, the issuance of debt, and borrowings under our revolving credit facilities.
Our effective tax rate is primarily impacted by the mix of foreign and U.S. income, tax rates in China and Hong Kong, the U.S. federal income tax rate, apportioned state income tax rates, the generation of credits and deductions available to us as well as changes in valuation allowances and certain non-deductible items. 34 SEGMENT OPERATING RESULTS Basis of Presentation During the quarter ended June 30, 2025, in connection with our change in organizational structure to enhance clarity in sector performance, accountability, and operating costs, our management finalized its assessment of our operating segments and concluded that we have three reportable segments: A&D, Commercial, and RF&S Components.
Based on our analysis, we determined that the fair value of the RF&S Components reporting unit was less than its carrying value and recorded a non-cash goodwill impairment charge of $32.6 million during the year ended December 30, 2024.
We completed our quantitative goodwill impairment analysis related to our PCB, A&D, and Commercial reporting units by comparing the fair value of each reporting unit with its carrying amount. Based on our analysis, we determined that the fair values of the PCB, A&D, and Commercial reporting units were greater than their respective carrying values.
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We believe the planned investment aligns with New York State’s continuing focus on the region as a premier technology hub for U.S. electronics and the recent selection of Buffalo-Rochester-Syracuse (BRS) for the Federal Tech Hub designation. The project reflects our support for cultivating a stronger microelectronics ecosystem in New York and across the U.S. Aerospace and Defense industrial base.
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RECENT DEVELOPMENTS On July 9, 2025, we announced the acquisition of a facility in Eau Claire, Wisconsin, as well as land rights for an additional future manufacturing site in Penang, Malaysia.
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The new building will be located on the 24-acre property adjacent to our existing facility in Syracuse, and we expect to commence initial low rate production in 2026. Phase one of the proposed project, including capital for campus-wide improvements is estimated to be $100.0 million to $130.0 million.
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We believe the Eau Claire, Wisconsin facility comes equipped with the necessary infrastructure to support advanced technology PCB manufacturing and enhances our ability to support future high-volume U.S. production of advanced technology PCBs across key markets, particularly data center computing and networking for generative AI applications.
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We expect to receive support in the form of grants, awards, and tax credits from both federal and New York state sources of approximately $52.0 million in the aggregate (subject to certain requirements and contingencies), which would offset the initial capital investment and lower operating expenses.
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In addition, we acquired land rights for ten acres in Penang to establish a new production site that we anticipate will align with customers’ increasing interests in supply chain diversification beyond China.
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In addition, we previously announced plans to consolidate our integrated electronics facilities in Elizabeth City, North Carolina and Huntington, New York into existing facilities in order to improve efficiencies.
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The future Penang facility will be in close proximity to our existing facility and will enable us to deliver cost-competitive, high-quality advanced technology PCB manufacturing to commercial markets such as data center computing, networking, and medical, industrial, and instrumentation. Together, these new investments support our strategy to offer regionally optimized, globally connected manufacturing solutions for our customers.
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As of the end of fiscal year 2024, the closure of Elizabeth City has been completed and the closure of Huntington is expected by the middle of 2025. 41 FINANCIAL OVERVIEW While our customers include both OEMs and EMS providers, we measure customers based on OEM companies, as they are the ultimate end customers.
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The building construction is complete, equipment is arriving, and we are beginning to install and test equipment setups. Volume production in this facility is expected to commence in the second half of 2026. 30 FINANCIAL OVERVIEW Our customers include both OEMs and EMS providers. We sell to OEMs both directly and indirectly through EMS providers.
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Sales to our five largest customers accounted for 42%, 41%, and 33% of our net sales in fiscal years 2024, 2023, and 2022, respectively, which is in line with the increase in sales in our aerospace and defense end market. We sell to OEMs both directly and indirectly through EMS providers.
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For such indirect sales, we measure customers based on OEM companies as they are the ultimate end customers. Sales to our ten largest customers collectively accounted for 55%, 42%, and 41% of our net sales in 2025, 2024, and 2023, respectively.
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Management has discussed the development, selection, and disclosure of these estimates with the Audit Committee of our Board of Directors. Actual results may differ from these estimates under different assumptions or conditions.
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While experience has shown that trends in gross margins are not volatile, changes in pricing or cost efficiencies could create significant fluctuations.
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We apply a five-step approach in determining the amount and timing of revenue to be recognized: (1) identifying the contract with a customer; (2) identifying the performance obligations in the contract; (3) determining the transaction price; (4) allocating the transaction price to the performance obligations in the contract; and (5) recognizing revenue when the corresponding performance obligation is satisfied.
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Goodwill and Intangible Assets During the quarter ended June 30, 2025, in connection with our change in organizational structure to enhance clarity in sector performance, accountability, and operating costs, we concluded that we have three reportable segments: A&D, Commercial, and RF&S Components. In prior periods, we had two reportable segments: PCB and RF&S Components.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Dollar as a normal part of our financial reporting process. Most of our foreign operations have the U.S. Dollar as their functional currency. However, one of our China facilities utilizes the Renminbi (RMB), which results in recognition of translation adjustments included as a component of other comprehensive income (loss).
Dollar as a normal part of our financial reporting process. Most of our foreign operations have the U.S. Dollar as their functional currency. However, one of our China facilities utilizes the RMB, which results in recognition of translation adjustments included as a component of other comprehensive income (loss).
In March 2023, we entered into a four-year pay-fixed, receive-floating (1-month Chicago Mercantile Exchange (CME) Term SOFR), interest rate swap arrangement with a notional amount of $250.0 million for the period beginning April 1, 2023 and ending on April 1, 2027.
In March 2023, we entered into a four-year pay-fixed, receive-floating (1-month CME Term SOFR), interest rate swap arrangement with a notional amount of $250.0 million for the period beginning April 1, 2023 and ending on April 1, 2027.
We do not enter into derivative financial instruments for trading or speculative purposes. As of December 30, 2024, we did not have any material commodity contracts in place and believe our exposure to commodity price risk is not material. We have not experienced any losses to date on any derivative financial instruments due to counterparty credit risk.
We do not enter into derivative financial instruments for trading or speculative purposes. As of December 29, 2025, we did not have any material commodity contracts in place and believe our exposure to commodity price risk is not material. We have not experienced any losses to date on any derivative financial instruments due to counterparty credit risk.
Interest Rate Risks Our business is exposed to risk resulting from fluctuations in interest rates. Our interest expense is more sensitive to fluctuations in the general level of Term Secured Overnight Financing Rate (SOFR) interest rates than to changes in rates in other markets.
Interest Rate Risks Our business is exposed to risk resulting from fluctuations in interest rates. Our interest expense is more sensitive to fluctuations in the general level of Term SOFR interest rates than to changes in rates in other markets.
No ineffectiveness was recognized for the year ended December 30, 2024. During the years ended December 30, 2024 and January 1, 2024, the interest rate swap decreased interest expense by $4.2 million and $3.2 million, respectively.
No ineffectiveness was recognized for the year ended December 29, 2025. During the years ended December 29, 2025 and December 30, 2024, the interest rate swap decreased interest expense by $1.9 million and $4.2 million, respectively.
As of December 30, 2024, approximately 81.1% of our debt was based on fixed rates. Based on our borrowings as of December 30, 2024, an assumed 100 basis point change in variable rates would cause our annual interest cost to change by $1.8 million.
As of December 29, 2025, approximately 81.4% of our debt was based on fixed rates. Based on our borrowings as of December 29, 2025, an assumed 100 basis point change in variable rates would cause our annual interest cost to change by $1.7 million.
In general, our Chinese customers pay us in RMB, which partially mitigates this foreign currency exchange risk. 50 Debt Instruments The fiscal calendar maturities of our debt instruments for the next five years and thereafter were as follows: As of December 30, 2024 2025 2026 2027 2028 2029 Thereafter Total Fair Value Weighted Average Interest Rate (In thousands, except interest rates) US$ Variable Rate (1) $ 3,465 $ 3,465 $ 4,331 $ 83,465 $ 2,599 $ 328,309 $ 425,634 $ 426,930 6.41 % US$ Fixed Rate 330 350 404 363 500,419 445 502,311 466,636 4.01 Total $ 3,795 $ 3,815 $ 4,735 $ 83,828 $ 503,018 $ 328,754 $ 927,945 $ 893,566 (1) Interest rate swap effectively fixed $250,000 of variable rate debt.
Our primary foreign exchange exposure is to the RMB and MYR. 39 Debt Instruments The fiscal calendar maturities of our debt instruments for the next five years were as follows: As of December 29, 2025 2026 2027 2028 2029 2030 Total Fair Value Weighted Average Interest Rate (In thousands, except interest rates) US$ Variable Rate (1) $ 3,465 $ 4,331 $ 83,465 $ 2,599 $ 328,309 $ 422,169 $ 425,806 5.79 % US$ Fixed Rate 350 404 363 500,419 445 501,981 490,306 4.01 Total $ 3,815 $ 4,735 $ 83,828 $ 503,018 $ 328,754 $ 924,150 $ 916,112 (1) Interest rate swap effectively fixed $250,000 of variable rate debt.
Information regarding our interest rate swap is as follows: For the Year Ended December 30, 2024 (In thousands, except interest rates) Average interest received rate 5.16 % Interest received amount $ 13,018 Average interest payout rate 3.49 % Interest payout amount $ (8,800 ) See Liquidity and Capital Resources in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 8, Note 8, Long-term Debt and Letters of Credit , of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K (Report) for further discussion of our financing facilities and capital structure.
See Liquidity and Capital Resources in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 8, Note 7, Long-term Debt and Letters of Credit , of the Notes to Consolidated Financial Statements included in this Report for further discussion of our financing facilities and capital structure.
As of January 1, 2024, the fair value of the interest rate swap was recorded as a net asset of $1.8 million, of which $3.3 million is included as a component of prepaid expenses and other current assets and $1.5 million is included as a component of other long-term liabilities.
As of December 29, 2025, the fair value of the interest rate swap was recorded as a liability in the amount of $0.4 million included as a component of other long-term liabilities.
Removed
Our primary foreign exchange exposure is to the RMB and Malaysian Ringgit (MYR).
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For the year ended December 29, 2025, we received $10.6 million in floating-rate interest at an average rate of 4.24% and paid $8.8 million in fixed-rate interest at 3.49%.

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